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1^7^ LIBRARY OF CONGRESS, r^l 



THE LABORER 

AND 

THE CAPITALIST 



BY ' 

FREEMAN OTIS WILLEY 






PtIBLlSHED BY 




THE 


NATIONAL ECONOMIC 

13 AsTOR Place 
NEW YORK 


LEAGUE 



7/ 



THE LJS^ARY OF 
CONGRESS, 

One Copy I^Eoeivto 

MAY. 9 1903 

OOBVWKWT 1?MTI»V 

CLAB ii yn^ . No. 

COPY A. 



. Ws 



Copyright, 1896 

BY 

FREEMAN OTIS WILLEY 



CONTENTS 



PART I. 
CHAPTER I. 



Page 



Development of the Subject. 

The Tribune on Unrest — A Glance into the Past - 2 

What the Unrest Means 5 

The Labor Leader ------- 7 

Kev. Heber Newton — Methodist Conference - - 11-12 

M. Deschanel — The Chaplain's Prayer . - - 13-14 

Congressman Colquitt — Judge Gresham - - - 15-16 

Bishops Potter and Spaulding — Ingalls - - - 16-17 

The Growth of Socialism— The Issue - - - 18-19 

CHAPTER II. 
How Shall We Meet the Issue? 

Political Conditions — Necessity for Education • - 19-23 

Popular Opinion — Labor's Soliloquy - - - 24-25 

CHAPTER III. 
Monopoly. 

Judge Brewer — Arguments Advanced - - - 27-29 

" Special Privileges" — Large and Small — Monopolies 30-34 

CHAPTER IV. 
Plutocracy. 

Definitions — Election Influences . - - . 35-36 

Universality of Plutocracy 37-38 



Contents. — Continued, 
CHAPTER V. 

Fagb 

The Wider View. 

Monopoly a Natural Principle ----- 40-41 
Webster — Power the Inheritance of the Few - 41-42 

CHAPTER VI. 

Do Corporations Concentrate Wealth ? 

Rev. Dr. Strong — The Cause of Prejudice - - - 43-44 

Corporations a Necessity of Civilization - - - 44 

The Standard Oil Company — The Many Benefited - 46-51 

Massachusetts Corporations — Female Stockholders - 52-53 

CHAPTER VII. 

Riches and Honesty. 

Dr. Strong and Others on the Danger of Riches, etc. 54-55 
Are the Rich Dishonest? 59-62 

CHAPTER VIII. 

The Growth of Socialism. 

First Principles — The Extent of Socialism - - - 64-66 

Judge Brewer — Dr. Strong — Dr. Mc Arthur - - 67-68 

Herbert Spencer on the Coming Revolution - - 69 

CHAPTER IX. 

Arguments for Socialism. 

The Coming Natioris Plea for Argument - - - 71-72 
The Socialists and the Populists — Judge Brewer again 73-74 
Change of Ownership of Soil — Equalization of Condi- 
tions in Europe and America _ . - . 75-76 
Speaker Reed — Wilson and Sovereign on Concentra- 
tion ....... 78-79 



Contents. — Coiitinued. 

Page 

The Bepuhlic on the Relation of Property to Man — 

Summary ..- 80-81 

CHAPTER X. 

The Division Between Man and Man. 

Rev. Dr. McLane on Unjust Distribution - - - 82 
The Diversity in Human Nature and Ambition - 84—85 
The Laws of Distribution, Exchange, and Mutual De- 
pendence 86-89 

Why Some Grow Rich — Reciprocity of Trade - 90-92 
The Value of Vanderbilt to the Community - - 93 

CHAPTER XI. 

The Division Between Capital and Labok. 

Mr. Sovereign — Mr. Whitworth on Land Monopoly - 95-96 
Who are Benefited ? — Loan Associations - - 98 

Growth of Building and Loan Associations - - 99 

Are Millions Wrung from the Poor? . - - 100 

The Test of the Profits of Capital - ... 104 

CHAPTER XII. 

/ The Gulf Between Capital and Labor. 

Dr. Strong on Machinery and the Division of Labor - 106 

Machinery Helpful 109 

Where is the Gulf? 112 

Do the Rich Stand in the Way of the Poor? - - 114 

CHAPTER XIII. 

Is Wealth Concentrating ? 

The Commercial Advertiser on the Social Problem - 117 
Astor and Pulitzer— The Diffusion of Benefits - 121-122 



111 



CoNTEN TS. — Continued, 

Page 

Ejrtravagance of the Kich no Detriment to the Poor - 125 

The Need of the South 126 

The Division of Profits 127 

CHAPTER XIV. 

Has Wealth Concentkated? 

The Tendency of Land to Diffuse - - - - 132 
Interest on Money — Who Bears the Burden? - 135-137 

Propertyless Immigrants ------ 140 

CHAPTER XV. 

The Blamed and the Pitied 143 

The Advertiser on Cleveland - - - . 144 

Hewitt on the Duties of Rich Men - - - - 149 

Poverty and the Soup House - - - - 150 
The Press on Suicides ----- 152-153 

CHAPTER XVI. 

The Blamed and the Pitied (Continued). 

Dr. Rainsford on the Tenements - - - - 154 

What is Spent for Drink - ... - 161 



PART 11. 

CHAPTER I. 
Child Labor. 

Dr. Strong on Child Labor 164 

Foreign Population in Cities ----- 166 

iv 



Contents. — Continued, 

Page 

Working Children of Illinois - • - - -167 
Savings Banks .------ 173 

CHAPTER 11. 

Does Labor Receive a Just Share ? 

Walter B. Harte on the Rich and Poor of Boston • 183 

The Journal of Commerce - - - - - 185 

The National Watchman - - - - -188 

The Gospel of Work 190-193 

The Treatment of the Destitute 199 

Who are Capitalists ? 201 

Large Concerns versus Small Traders - - - 203 

CHAPTER ni. 

Millionaires and the People. 

A Campaign Document — The Trihune^s Census - - 205 
A Proposition for the Workman - - - - 211 

CHAPTER IV. 
Recapitulation. 

Rev. Thos. Dixon on the Two Kingdoms — Mr. Shear- • 
man's Estimate ------- 213 

The Herald on New York Real Estate Owners - 215 

A Comparison of New York Real Estate, 1840 and 1894 222 
Distribution of Railroad Earnings - - - - 226 

Banks, Corporations, and Estates - - - - 228 

CHAPTER V. 
A New Book. 

Dr. Spahr on the Distribution of Wealth — Senator 

Chandler 230 

Common Observation 232 



Contents. — Continued. 

Page 

Massachusetts Labor Bureau on Savings-bank Depositors, 236 
New York and Brooklyn Savings Banks - - - 242 

CHAPTER VI. 

Surrogate Argument 244 

Savings-bank Accounts in the Surrogate Court - 245 

CHAPTEK VII. 

The Surrogate Argument as Applied to Property other 

than Savings-bank Accounts - - - - 250 

Property Owners in New York City — Female Property 

Owners - 251 

CHAPTER VIII. 

The Country at Large. 

New York Counties - - - - - - - 254 

Small Holdings — Dr. Spahr's Estimate for the Country 

at Large 258 

Report of Massachusetts Labor Bureau on Probated 

Estates. Remarks thereon 259 

Inventoried Estates of Massachusetts — Henry Gannett' s 

Estimate of the Distribution of Wealth - - 261-263 

CHAPTER IX. 

Railroads and Farms 265 

Is Wealth Concentrating in Railroads ? - - - 265 

CHAPTER X. 
Rented Farms. 

Who Rent Farms? . - - - . - - 269 



VI 



Contents. — Continued, 

Page 

Farmers versus Money Loaners, Manufacturers, and 

Merchants 270 

CHAPTER XI. 
The Fall of Wages. 

The Interdependence of Labor and Capital - - 271 

CHAPTER XII. 
The Poor m Cities. 

Dr. Spahr on Poverty in Cities - - - - -272 
Classification of Immigrants - - - - 273 

The Proportion of Foreign Population in Large Cities 

— Intemperance 274 

CHAPTER XIII. 
Taxes. 

Thos. G. Shearman on " Concentration " - - - 276 

Inflated Values 278 

Loss by Failures 279 

CHAPTER XIV. 

Tax-lists Compared. 

Boston Tax-list for 1888 Compared with that of 

1821 281-282 

Tax-Ksts of 1845 and 1888 Compared - - - 284 

CHAPTER XV. 
Millionaires. 

Mr. Shearman's Estimate and the Trihune^s List - 285-286 
A Deduction from the Massachusetts Surrogate Records 287 

CHAPTER XVI. 
The Way Incomes are Estimated. 

Dr. Spahr on Boston Rentals - - c • - 288 

vii 



Contents. — Continued. 
CHAPTER XVII. 



Pagb 



Farms and Cities. 

Dr. Spahr on Cities versus Farms and YiUages - 291 

The Interdependence of Farm and City - - - 292 

Farms versus aU Other Industries - - - 294 

An Analysis of City Wealth 298 

Mr. Debs's Commonwealth 300 

How Profits Diffuse 301 

Comparative Growth of Different Sections of the United 

States 302 

CHAPTER XVIIL 

Who Become Rich? 303 

The Cost of Intoxicants and Who Pay - • • 304 

CHAPTER XIX. 
Tenement Houses. 

Boston, 1845 and 1890— Why Some Occupy Bad 

Tenements -------- 306 

Wright on Intemperance 307 

A Comparison of Surrogate Records, Massachusetts, 

1830-1890 309 



vni 



The Laborer and the Capitalist. 



CHAPTER I. 

DEVELOPMENT OF THE SUBJECT. 

Not a few of the works written upon economic subjects 
in recent years are one-sided. Most of them were not in- 
tended to be so ; but the authors have generally had very 
strong convictions before they began to write, and naturally 
enough they have looked for facts and figures to demon- 
strate that those convictions had a solid basis; that is, 
taking the premises for granted, and having perfect confi- 
dence in the justice of the cause they were promoting, 
they have conscientiously ignored much that ought to have 
been taken into account, and innocently placed before the 
public many statements which a more searching analysis 
would have shown to be entirely without foundation, or to 
need a great deal of modification. This is as true of one 
side of the controversy as of the other, as appHcable to my 
own earlier writings as to those of other authors. This is 
an attempt to state the position of the laborer and that of 
the capitaHst with equal clearness, and to present the argu- 
ments for and against both without catering to either. 

Many of the leading facts that follow were found while 
search was being made for data to demonstrate conclusions 
the very opposite to those that were finally forced upon me 
by careful investigation. 

I have violated modern practice in the frequent use of 
the pronouns "I" and "We"; in short, I have made no 



THE LABORER AND THE CAPITALIST, 

attempt in this work to conform to the rules o£ polished 
literature. I have sought to make my meaning plain and 
to use such language as all can understand. And now 
the one favor asked is that no reader will condemn until 
he has read all the chapters. 

An extract from an editorial which appeared in one of 
our metropolitan journals shall introduce the subject which 
constitutes the title to this volume (see New York Tribune^ 
January 1, 1893), as follows: 

" The year closes with fresh indications of the increasing social 
unrest of the world. A dynamite explosion in the French capital is 
the responsive echo to despairing unreason in Dublin. Eussia, Italy, 
and the continental nations are seething with social discontent. . . 

" Great Britain has emerged from a troublous year of commercial 
depression and political excitement with an incongruous coalition 
of parties and factions held together by the genius of one man ; and 
the distinguishing characteristic of the situation is unrest. 

"If dynamite explosions, anarchistic plotting, and socialistic 
propagandism were the only symptoms of this unrest, even the 
most easy-going optimist would be unable to find compensations 
for what would be a malignant social disorder; but in the recent 
history of Europe and America such outbreaks of lawlessness play 
an insignificant part. It is in the thorough and systematic organ- 
ization of all forms of labor; in combinations for securing legisla- 
tion and recognition for class grievances and interests, and in the 
increased determination of the working forces of the world to have 
tLeir questions taken up and settled, that the feverish pulse of the 
times is now most strongly felt." 

Referring to the great political change which took place 
in the United States in November, 1892, the Tribune said : 



THE LABORER AND THE CAPITALIST. 

*^If the revolt against Republicanism and protection had 
occurred in hard times, when trade was stagnant and employment 
scarce, the results of the general election would have caused little 
surprise ; but what has happened is the complete reversal of the 
economic and business policies of the Nation in a most pros- 
perous year, when trade was never better, industrial enter- 
prise never greater, and labor never so fully employed or so well 
rewarded. . . . 

Possibly the true explanation of the political revolution lies 
in a conviction or hallucination in the minds of great masses of 
voters that American prosperity, while unexampled in modern 
history, is more unequally distributed than it ought to be. But 
however the proposition may be formulated, nothing less than 
social discontent and restlessness offers an adequate reason for a 
radical political reaction in the most prosperous of recent Ameri- 
can years." 

The article closed as follows : 

'* Whether all this social discontent, which is throbbing in Amer* 
ica as intensely as it is beating in Europe, will make the world 
better or worse, is the secret of another century." 

Before we comment upon this remarkable statement of 
the Tribune, let us glance a moment into the past. 

A hundred and twenty years ago the American ship 
of state was launched upon the surging sea of national 
destiny. Three thousand miles from the war-swept and 
turbulent Old World, she started on her course under 
conditions that promised rewards more tempting, and winds 
more helpful than had yet breathed upon a human govern- 
ment. 



THE LABORER AND THE CAPITALIST. 

Eighty-five years of marvelous progress had apparently 
justified the highest hopes and fulfilled the wildest proph- 
ecies of her f riendsj when the war of the great rebellion 
burst upon her. The gale was fearful, and the surge tre- 
mendous. The producing cause was chattel slavery ; slavery 
was stricken down, the storm ended, the stars and stripes 
waved over a union saved, and the well-tried ship sped on 
her God-appointed way, stronger, prouder, freer than before. 

Those who had feared for the safety of the great repub- 
lic were no longer anxious, and the friends of Hberty every- 
where rejoiced in the glorious prospects of the American 
nation, now free from the thraldom of human slavery. 

I shall not soon forget the glad look of a patriotic old gen- 
tleman in New Hampshire in 1866, when he spoke substantial- 
ly as follows : " Our one dangerous enemy since Great Brit- 
ain withdrew her troops from American soil has been negro 
slavery. That enemy is conquered, and conquered forever. 
Now all we have to do is to behave ourselves and enjoy 
peace and prosperity for all time to come." 

The old man undoubtedly voiced public opinion at that 
time, which seemed to be well grounded. For although 
the war had cost us fearfully, and sorrow still lingered at 
the Nation's hearthstone, yet commercial enterprise was won- 
derfully active and financial prosperity dwelt among us as 
never before. 

Labor troubles, such as now afflict the country, had not 
been dreamed of, and so far as human vision could then 
reach there stretched before us a broad highway of peace 
and prosperity. 



THE LABORER AND THE CAPITALIST. 

But the rosy hopes of those days soon faded. Eight 
years brought us to the ever memorable 1873. Disorder 
and riot came into our midst^ and we felt the advance 
waves of the eddying current upon which the Old World 
had been tossed and whirled for centuries. Twenty 
years later (1893) the New York Tribune tells us (truth- 
fully too) that discontent is throbbing as intensely in Amer- 
ica as it is beating in Europe. And the present year (1896) 
Chauncey M. Depew voiced the sentiment of thoughtful minds 
when he declared our ci^olization a paradox, and stated that 
although the fathers had founded a government every way 
calculated to bring prosperity and contentment^ yet the 
present unrest exceeded anything the world had before 
known. 

Now let us take a seat before this extraordinary proposi- 
tion, this marvelous phenomenon, and sit there until we 
feel sure we comprehend its meaning. 

It is surprising what a circumscribed view some of our 
leading citizens have of the present political and industrial 
situation. There are distinguished politicans (some of them 
are called statesmen) who are of the opinion that currency 
and tariff legislation have bred all the discontent we need to 
feel concerned about, and that when these issues are settled 
according to sound poHtical ethics (which, of course, means 
according to their ethics) industrial contentment will reign, 
and the dispute between capital and labor will be practi- 
cally ended. The Tribune is of the opinion, however, that 
" the conviction or hallucination in the minds of voters, 
that American prosperity is not fairly distributed," is the 



THE LABORER AND THE CAPITALIST. 

primal cause of the universal discontent it describes. This 
is the larger, and indeed the only view of the case at all 
consistent with the facts that bear upon it. 

Business is often disturbed by legislation threatened as 
well as by legislation accomphshed. It is also true that 
when business is disturbed the masses are more restless, 
and party supremacy more shifting. Nor can it be doubted 
that the tariff and currency questions are becoming power- 
ful elements in the problems we have to solve in our own 
country. Nevertheless, the world-wide belief that the re- 
sults of a common industrial effort are not being fairly 
divided is the one all-sufficient reason why, to use the lan- 
guage of the Tribune, " the feverish pulse of the times is 
now so strongly felt." 

April 9, 1892, the Labor Leader, a worthy labor journal 
pubHshed in Boston, contained a speech by one Michael 
Lynch, from which the following is copied : 
**In a land whose bowels teem with all the varieties of natural 
wealth men are naked, homeless and starving ; you who bear the 
burden of an extravagant, a wanton, and a barbaric luxury, and 
yet have not wherewith to appease your hunger, starved, impris- 
oned, tortured into subjection, " Pinkertoned " to death; you who 
from your miserable hovels can see the palaces of your masters 
rising around you ; who can behold their luxurious equipages, and 
yet must trudge on foot yourselves ; you can read of their ocean 
greyhounds, their trips to Europe, their Newports, their Saratogas, 
and deprived yourselves of air and light, with no vacations, few 
amusements, and less rational enjoyment, will you not see all this, 
when you know that all this lofty fabric of luxury and ease springs 
from your labor ? '^ 



THE LABORER AND THE CAPITALIST. 

May 14, 1892, the same journal had an article entitled : 
" Millionaires as Bellamy Sees Them." The following was 
given as Mr. Bellamy's language : 

"If a small boy should be found with a roll of 81,000 in his pos- 
session, the presumption would be that he could not possibly have 
earned so large a sum — he must have stolen it ; and he would be 
immediately and unceremoniously taken by the coUar and made to 
give an account of how he came by the money. We respectfully 
submit that when a grown man is found with $1,000,000 in his 
possession it is equally safe to assume that he did not come by so 
large a slice of the national wealth by any proper means, and that 
society should therefore take him by the scrufE of the neck and 
make him give an account of how he secured what he has. We 
undertake to say that no man can justify his possession of $1,000,- 
000 on sound ethical grounds. It is as much out of the power of 
a grown man fairly to earn that sum as it is beyond a boy's power 
to earn a thousandth part of it." 

The extract below is copied from an editorial which ap- 
peared in the same journal October 31, 1891 : 
^'As to " luck," no one has ever fully and satisfactorily defined 
that term, but taldng it to mean what is usually accepted as its 
significance, I imhesitatingly declare that of aU the enormously 
wealthy men in this country, only some who have become so through 
" luck " can successfully defend themselves against the charge of 
robbery.'' 

At a labor conference held in New York (see New York 
World, December 20, 1892), a committee reported the fol- 
lowing : 

** Multi-millionaires are gradually becoming billionaires, while 
the masses of the people of the United States are being trans- 



THE LABORER AND THE CAPITALIST. 

formed into a dependent class, with conditions similar to those 
under which the European pauper and wage slave toils, suffers, 
and dies." 

Mr. Lynch believes that the luxuries which the few enjoy 
represent the earnings of the many, for which a fair equiv- 
alent has not been rendered. 

Mr. Bellamy believes it impossible for one man to acquire 
a million dollars honestly, and that our millionaires should 
be made to divulge the means by which they acquired their 
wealth. 

The editor of the Labor Leader thinks that except in rare 
cases of lucky venture our very wealthy people may be 
justly charged with having committed robbery. 

Those who assembled at the Labor Conference seem to 
have been imbued with the idea that through the accumu- 
lation of large fortunes in the hands of a few, the poorer 
classes of the United States are being reduced to a condi- 
tion of servitude very like that which is understood to exist 
in some parts of the Old World. 

Collectively considered, the utterances of these laborers 
and labor leaders amount to a resolute and positive protest 
against what they regard as the robbery and oppression of 
labor by capital ; and an earnest appeal to the masses to 
dethrone the power which, according to their belief, is 
weighing them down. 

Labor is blamed, more or less, for muttering and threat- 
ening and striking. 

Nevertheless, let any of us, let a moral or Christian cap- 
italist, for example, one who is happy in the belief that he 



THE LABORER AND THE CAPITALIST. 

desires to do that which is nearest right for all concerned, 
ask himself the question: "If I were in the ranks of 
lahor, and really believed that capital was constantly gath- 
ering my earnings to itself, thereby rendering me more and 
more dependent upon the good graces of the rich for a 
livelihood for myself and family, would I not mutter? 
would I not threaten? would I not strike? Indeed, would 
I not do whatever seemed necessary to my own independ- 
ence, and to the independence of those who have natural 
claims upon me, for at least an opportunity to keep for their 
own use that which their hand and brain honestly earn?'* 

It is plain that from the workingman's standpoint he has 
the highest possible motive for the energy he is putting 
forth to gain a larger share of the joint efforts of capital 
and labor. Through this he sees, or thinks he sees, not 
only a benefit for himself, but a larger industrial freedom 
and a smoother path for his posterity than his own weary 
feet have ever trod. 

It is not to be wondered at, therefore, that labor is per- 
fecting organization, national and international, and mak- 
ing attempts more and more powerful to control legislation. 

This does not necessarily foreshadow the bloody revolu- 
tion and reign of terror that some are looking for ; but it 
makes it very plain that the world is confronted with a new 
economic problem that must not be ignored. 

The truth of this proposition will be more forcibly felt 
if we stop to consider the moral aid and the number of 
strong recruits coming to the support of labor from those 
who are not laborers. 



THE LABORER AND THE CAPITALIST. 

It has been many times stated that were it not for a few 
shriekers among those who do not own their homes, 
who have not sufficient property or income to render them 
decently independent, who are obliged to sell their services 
in the market for any price offered, labor would be con- 
tented and peaceful. We have writers and speakers who 
have gone so far as to say that the quarrel with the present 
regime, the industrial discontent, and the sociaHstic propa- 
gandism now going on have resulted mainly from the efforts 
of anarchists from the Old World, who have been joined 
here by disappointed poHticians and such badly balanced 
individuals as have been unsuccessful in other directions, 
and that the adherents of their doctrines are composed 
largely of the lazy, the dishonest, and the shiftless poor. 

It is important that we have the truth in regard to this 
matter early in the discussion. Let us have all the factors 
in the case. 

If labor is being stirred by a general impulse, who besides 
laborers are creating that impulse? If laborers are con- 
vinced that capital is robbing them, do they stand alone in 
that belief ? K socialistic ideas are being propagated, are 
there respectable propagators outside of the labor ranks ? 

Never had I so realized the magnitude of the capital 
and labor question, and felt the nearness of a great crisis, as 
when the full truth dawned upon me regarding a force not 
identified with labor, but which can and does (in conse- 
quence of its high character and exceptional intelligence) 
influence the outside world against the present regime a 
thousand times more than those in the ranks of labor could 

10 



THE LABORER AND THE CAPITALIST. 

possibly do. It is due to tlie laborer that this fact be made 
to stand out clear as against the accusation that only the 
dependent and the dishonest, etc., share his opinions. 

On the 18th of October, 1891, the Kev. Dr. E. Heber 
Newton preached a sermon, concerning which the New 
York World of the next day reported as follows : 

"He said he agreed with a potentate who was frank enough 
to admit that we had gone wrong in not holding mineral resources 
in fee for the spread of education. Lines of travel should be con- 
troUed by the government. Then he concluded : 

" In a cross and grumbling mood Carlyle once said that the 
ideal before the American people was to place a turkey in the 
pocket of every poor man. Not a wholly ignoble idea, considering 
what was there before. If, instead of a bone, a breast of a chicken 
can be carried, so much the better. The vast mass of men are 
born into the most pitiful circumstances. You and I know the 
trouble of living under adverse conditions. What is to be done, 
then, when from the cradle to the grave it is only a struggle for a 
crust of bread ? " 

This distinguished and justly popular divine thinks that 
government ought to control mineral resources — gold, sil- 
ver, copper, iron, tin, lead, coal, etc., and the lines of travel 
as well. He evidently believes that placing the vast wealth 
of mines and lines of travel under the control of govern- 
ment, instead of allowing it to remain in the hands of in- 
dividuals, would improve the condition of the masses. 

Whether Dr. Newton's theory be sound or otherwise, 
the principle his words suggest is that of sociaHsm ; indeed, 
government ownership of mines, lines of travel and com- 

11 



THE LABORER AND THE CAPITALIST. 

munication, is advocated by socialists as tlie first necessary 
step toward government control of all industries now yield- 
ing a profit to private capital. 

A few weeks prior to the Presidential election of 1892 
there appeared in the New Nation (Bellamy's paper) an 
account of a Presbyterian Conference held in Boston. It 
stated that one of their prominent preachers declared that 
socialism was a Christ principle, therefore it had come to 
stay. If the remark provoked any opposition in the meet- 
ing, it was not reported. 

In a synopsis of the proceedings of the New York 
Methodist Conference, the World, April 4, 1892, said : 

"Rev. Dr. North presented the report of the Committee on the 
question of the relation of the Church to Socialism. The report 
was in part as follows ; 

" A new political economy is now growing up among us, which 
must be recognized. The conviction is certainly growing that 
many of the existing evils of society should be cured. No more 
important question can occupy the attention of the Church than 
the problem called Socialism. 

" The Methodist Episcopal Church, having given so much atten- 
tion to slavery, intemperance, and ignorance, should also devote 
some time to another great evil — the alleged alienation of the 
poor from the church. We believe that this prodigious inequality 
in the ownership of property is a frightful evil." 

Observe the language used by these gentlemen of edu- 
cation and culture : " A new political economy is growing 
up among us which must be recognized. . . . No 
more important question can occupy the attention of the 

12 



THE LABORER AND THE CAPITALIST. 

church than the problem called Socialism. . . . We 
beheve that the prodigious inequality in the ownership of 
property is a frightful evil." 

Whether these people are right or wrong in their con- 
clusions regarding SociaHsm and the ownership of prop- 
erty, they are, nevertheless, powerful molders of pubHc 
opinion, and they belong to an intelligent and highly 
respected class of citizens whose name is legion. 

M. Paul Deschanel, of the French Chamber of Deputies, 
was sent by his government to this country in 1891 to 
study the Socialistic and labor problem. Prof. J. E.. Bu- 
chanan quotes him in the Areiia as follows: 

^^1 do not doubt at all that the civilized world is rapidly ap- 
proaching, if it has not already reached, a period which will give 
birth to such a crisis as was the French Revolution, or perhaps to 
even a greater crisis. It is because we recognize the gravity of 
the situation that such men as myseK are making our strongest 
efforts to understand the rights and the wrongs of the laboring 
classes, with the view of giving them at least a measure of what 
is their due and so averting the terrible disaster which would 
result should they arise in their might and renew the scenes of 
terror and bloodshed by which their ancestors wrested their rights 
from the aristocracy which had trodden upon them, as the Social- 
istic orators of to-day declare that the classes they represent are 
being trodden upon.^^ 

Not long since a chaplain of the American Congress 
prayed as follows : 

'*Give ear, O God of Jacob, and awaken us to see the danger 
which threatens the civilized world, a revolution more tremendous 

13 



THE LABORER AND THE CAPITALIST. 

than any of whicn history tells, in which the scenes of the Eeign 
of Terror may be enacted in every capital in Europe and America. 
For, long, the few have mastered the many because they under- 
stood the open secret, the tools to them that can use them; but 
now they have learned the secret of organization, drill, and dyna- 
mite. Kouse the rich of the world to understand that the time 
has come for grinding, selfish monopoly to cease, that corporations 
may get souls in them with justice, honor, conscience, and human 
kindness. Teach the rich of this country that great fortunes are lent 
them by Thee for other purposes than to build and decorate palaces, 
to found private collections of art, to stock wine-cellars, to keep 
racing studs and yachts, and find better company than hostlers, 
grooms and jockeys, pool-sellers and bookmakers. Teach them, 
O God, that it is Thee who has given them power to get these 
fortunes ; that it is to prove them, to know what is in their hearts, 
whether they will keep thy commandments or no, and that these 
commandments are " Thou shalt love the Lord thy God with all 
thy heart, and thy neighbor as thyself"; that if the rich men of 
our land keep these commandments, the poor will follow the ex- 
ample, and we at least will be saved from the days of tribulation 
that are fast coming on all the world. Help us, O God, and save us." 

One Congressman asked unanimous consent that this 
prayer be printed in the Record-, another objected on the 
ground that it was an incendiary speech. 

Call the prayer what you please, the sentiments expressed 
by the chaplain have been matched and overmatched again 
and again in our national legislature within the last few 
years by men of all parties. Instance the speech of Con- 
gressman Colquitt {Congressional Record, Dec. 1, 1890, 
to Jan. 8, 1892, page 452) as follows : 

14 



THE LABORER AND THE CAPITALIST. 

*'In the iron trend of centralized power and the corruption of 
gigantic wealth, shall we drift back into the reality of a mo- 
narchical regime, with but the semblance of freedom ? . . . 

*'I turn to the social chasm, ever widening by the false distribu- 
tion of wealth. The disparity is enormous. Consider the cost of 
a doUar to the poor. . . . Consider the ease and luxury of 
the rich. . . . 

'^I see the driven masses of the world's workers, the delver in 
the coal mine, on his side crawling to his dark task, lamp in his 
hand, lying down, no room to stand ; the plodding farmer, with 
his hoe at noonday in the burning sun ; the grim smith, wielding 
wearily his ponderous hammer ; the brawny engineer, in his mid- 
night vigils, with his strong hand upon the throttle of his pulsing 
monster ; and the other multitudinous toilers. 

** Trace the earning of the dollar that pays these pressed labor- 
ers. See the sewing-woman's mite and the beast of prey that 
absorbs it. . . . 

"To the laborer belongs the fruit of his toil ; but does he get it? 
Is there no predatory class standing by, ready to seize upon it ? 
See the poor, overworked wight, so abject and pitiful. Has any 
one the heart to plunder him? The ever- widening social chasm 
answers the question too well. 

"Consider the temper of the producing classes. They will not 
always bear submissively. . . . History is full of their des- 
perate uprisings for relief." 

Mr. Colquitt believes that the false distribution of wealth 
is rapidly widening the gulf between capital and labor; and 
that capital is practicing so intolerable a tyranny over the 
working-people that a continuance of the same will sooner or 
later result in a general and possibly a violent uprising. 

15 



THE LABORER AND THE CAPITALIST. 

According to tlie New York World, June 27, 1892, 
Judge Walter Q. Gresham was asked by a reporter what 
abuses he thought threatened to disturb pubUc tranquillity, 
and he answered as follows : 

'^I would say that the control of elections and legislation by 
the corrupt use of money more than anjrthing else menaces popular 
government and the public peace. If these abuses are not speed- 
ily checked the consequences are likely to be disastrous. If the 
people are convinced that they cannot rely on the ballot as a 
means of expressing their choice of men and measures, there will 
be a revolt the like of which the country has not yet witnessed. 
. . . The most insidious of all forms of tyranny is that of 
plutocracy.'' 

It is possible to imagine that a Republican may suggest 
that Colquitt was a Southerner, and might have been moved 
by jealousy of Northern wealth and political power, and that 
Judge Gresham was a member of a Democratic cabinet. 

If we assume that Mr. Colquitt and Judge Gresham spoke 
from unworthy motives, or that they were blinded by Dem- 
ocratic or Southern sympathies, then what shall we say of 
the Methodist Conference, which was composed largely of 
Republicans, with Northern sympathies? 

In the August number of the Arena, 1890, Prof. J. R. 
Buchanan quoted Bishop Potter as saying that our pluto- 
crats were dangerous alike to liberty and religion. The 
same author quoted Bishop Spaulding as using the follow- 
ing language : 

"Our rich men — and they are numerous, and their wealth is great 
— their number and their wealth will increase ; but our rich men 

16 



THE LABORER AND THE CAPITALIST. 

must do their duty or perish. I tell you, in America we will not 
tolerate vast wealth in the hands of men who do nothing for the 
people.^' 

In conversation with a distinguished lawyer and military 
officer who had command of troops at Homestead after the 
riot which took place in the summer of 1892, he said that 
he had been very much astonished at the extent and warmth 
of the sympathy for the strikers, and the sources from which 
it came. A judge of one of the courts had said to him in 
private conversation that property was altogether too un- 
equally divided, and that a leveling-up must take place 
sooner or later, but that just how it would be brought about 
he could not tell. 

Dr. Lyman Abbott says that the great problem of politi- 
cal economy in the past has been how to get wealth, but 
that the great problem of political economy in the future 
will be how to distribute wealth. 

This is a mild way of saying that the product of the 
joint efforts of capital and labor is not being fairly divided. 

In a lecture delivered in Chickering Hall, New York, that 
distinguished orator and logician Prof. Felix Adler ex- 
pressed the hope that the time was near when labor would 
receive a larger and juster share of the product of industry. 

About two years ago ex-Senator Ingalls, one of the most 
brilliant of American orators, delivered a lecture at Glen 
Echo, District of Columbia, to a vast audience composed 
largely of religious and well-to-do people. He expressed a 
doubt as to whether a hundred thousand dollars were ever 
honestly earned by one man. The cheering of this senti- 

17 



THE LABORER AND THE CAPITALIST. 

ment was hearty and almost unanimous. It is not too much 
to say that the same sentiment would be as heartily ap- 
proved by any popular audience in Christendom. 

This feeling among the masses Edward Bellamy would 
call Socialism, the growth o£ which he thinks is clearly 
indicated by the immense sale of his book. He believes 
that had " Looking Backward" been pubhshed twenty years 
ago it would have fallen dead from the press. It is proba- 
ble that at that time the work would not have paid the cost 
of printing. But the increasing unrest and growing desire 
to study economic subjects have given Bellamy's book a wide 
sale ; but what is more significant is the fact that, although 
the work is in the hands of all classes of people, adverse 
criticisms have been very few, and not one-tenth part as 
widely read as the book itself. The first to call the writer's 
attention to that now famous work was a wealthy citizen of 
Massachusetts^ a manufacturer, and a banker as well. He 
thought it contained more sound philosophy than the world 
had yet dreamed of, and gave it as his opinion that as an 
author Edward Bellamy had come to stay. 

However, call it Socialism, or give it some other name, 
the fact remains that an overwhelming majority of the 
world's inhabitants, good and bad, learned and unlearned, 
are of the opinion that the product of industry is not being 
divided with any approach to fairness; iliat the colossal 
fortunes we see all around us have not been honestly earned 
by the heads and hands that now control them ; that the 
laws are dictated by plutocrats in the interest of plutocrats ; 
that the richer the few become, the harder it is for the 

18 



THE LABORER AND THE CAPITALIST. 

many to make themselves comf ortable^ and that the duty of 
the hour is to so change social and economic methods that 
each and every one shall have the full results of his own 
efforts. This is an honest ambition for labor and its 
friends under the belief they now hold. It is contrary to 
man's nature to rest quietly while he is being robbed, or 
while he thinks he is being robbed ; and the still more im- 
portant fact is that it matters not whether the aforesaid belief 
be founded in truth or whether it be an hallucination — it 
means unrest, dynamite, and nobody knows what else, until 
either a fair division of the product of industry shall have 
been assured or the hallucination regarding it shall have 
been destroyed. 



CHAPTER II. 

HOW SHALL WE MEET THE ISSUE? 

On the 28th of January, 1891, one of the leading New 
York daiHes (the Press) had the following : 
"We notice that some of our contemporaries pretend to poke 
fun at the Farmers' AlHance. The movement is one that, how- 
ever faulty some of its aims and questionable the methods of cer- 
tain promoters, deserves respectful attention, and that the Press 
proposes to give it. Whatever the essential wrong may be that 
has aroused a vast body of toilers to an emphatic political protest, 
it is the duty of the Republican party to ascertain that wrong and 
provide a remedy." 

What this journal assumes to be the duty of the Repub- 

19 



THE LABORER AND THE CAPITALIST. 

lican party is unquestionably the duty of all parties in all 
lands. The unrest is universal, which proves that the cause 
is also universal ; and there can be no rational doubt that 
that cause is the unequal distribution of wealth. 

This being true, it matters not how much the masses are 
misinformed regarding the issue they urge — our first duty 
is to prepare to meet it wisely. And if we do meet it wisely 
and in a way to win a peaceful solution, it will be because 
we are conscious of the nature, magnitude, and disposition 
of the forces with which we have to grapple and show a 
disposition to deal fairly with all concerned. 

The distribution of the product of industry constitutes 
a problem reaching deeper and extending farther than any 
that has ever before confronted the race. Religious ques- 
tions and controversies have rarely extended beyond the 
limits of one or two countries — of tener they have been con- 
fined to parts of countries ; but the question of the dis- 
tribution of the results of toil knows no religion, no coun- 
try, nor stops at the boundary line of any State. Then, 
too, it is rugged and obstinate from long years of steady 
development. It is as old as the wage system. It was 
born when it became evident that some were accumulating 
vastly more than others, with apparently no more effort 
and no more economy. Many attempts have been made to 
strangle it and stop its progress. But on, straight on, it 
travels, with heavier tread and more hurrying pace, leaping 
mountains, deserts, seas, pushing other issues aside, as the 
mighty glacier pushes the smaller cakes of floating ice that 
chance to lie in its pathway. 

20 



THE LABORER AND THE CAPITALIST. 

It is gratifying to see the people becoming so much inter- 
ested in political economy. It promises more happiness and 
safety for all, through a clearer understanding of the rights 
and duties of all. 

Yet political conditions are bewildering. CapitaKsts have 
their poKtical schemes which they wish to promote; thej> 
also have the bulk of the money, which, even when legiti- 
mately used, contributes powerfully toward the success of 
parties. The laboring people also have their political schemes, 
together with a majority of the votes to be cast, and danger 
lurks in the fact that after all both the laborer and the cap- 
itahst may rely more upon their power at the polls to achieve 
immediate success than upon the better education of all in 
the science of economics. A gentleman of some distinc- 
tion recently complained that our legislators were making 
statutes according to an unreasoning popular demand. Sev- 
eral States, he said, had already passed anti-trust laws, etc., 
that were clearly unconstitutional, and likely to do harm ; 
but he thought going into the courts and there demonstrat- 
ing the unconstitutionaHty of such laws would remedy the 
evil. He beheved the people were wrongly informed regard- 
ing the effect of trusts and corporations, but did not think 
it worth while to go back of legislatures and courts to edu- 
cate public opinion. " We will," said he, " plant our bat- 
teries upon the hill-tops and defend our position from the 
higher level, and not skirmish in the woods and byways 
below." 

This view of the case fails to grasp the situation ; it sees 
not the issue j it does not recognize the power and temper 

U 



THE LABORER AND THE CAPITALIST. 

of the people at this most extraordinary juncture in human 
affairs. 

Public opinion is often wrong for a time ; nevertheless, it 
always thinks it is right ; and in these days of general sus- 
picion, no sooner is a legal decision obtained contrary to 
that opinion (especially by a corporation) than foul play is 
suspected. If the court has not actually been bribed, cor- 
rupting influences are believed to have been brought to 
bear somewhere in the case. At any rate, concentrated 
wealth is supposed to have succeeded in thwarting the ends 
of justice, and the masses are less friendly toward associated 
capital than before the decision was rendered. 

Our people are law-abiding, and respect the decisions of 
courts up to a certain point, but nothing has been more 
clearly demonstrated in American experience than that a 
law, to be practically operative, must be backed by public 
sentiment. 

The fugitive-slave law was believed to be constitutional, 
even by Danial Webster and Henry Clay, and the famous 
Dred Scott decision by our Supreme Court certainly did not 
contradict the letter of the Constitution, but both the law 
and the decision contradicted public sentiment, and every 
attempt to enforce or defend them only exasperated the 
people, and rendered the destruction of slavery more swift 
and certain. 

The popular belief is that an emergency is here, and the 
people are defending what they believe to be their rights 
with an energy, a fortitude, and an independence worthy of 
free citizens. They are very httle concerned about what 

22 



THE LABORER AND THE CAPITALIST. 

the courts have said, are sapng, or are likely to say, regard- 
ing, not the loisdom, but the constitutionality of, here and 
there, a legislative enactment. They are looking deeper 
and their vision sweeps a broader field. They are con- 
sidering the rights of man abstractly, and trying to 
measure the extent of his natural relation to the State, 
which they believe is greatly interfered with by 
existing statutes and political methods. And while it 
is safe to say that no considerable portion of our people 
have a thought of violating any statute or disre- 
garding legal decisions, yet they realize as never before 
that they are the tribunal of last resort, the sovereign power 
in the land, the final arbitrators of all questions relating to 
the public welfare. While courts are trying individual 
causes the people are trying the courts. In short, all estab- 
lished methods of procedure — legislative, judicial, economic, 
or what not — are being brought to the common throne of 
reason and the bar of pubHc conscience. Monopoly, plu- 
tocracy, tariff, socialism, etc., etc., must here plead, and 
here stand or fall. Say what you will and do what you 
will, the general rule of conduct to be followed and the 
laws that must finally be obeyed will be such as the great 
public see fit to dictate. 

Whether these rules and laws are to be just or unjust, 
whether they hinder or facilitate progress, whether they 
promote peace or stir up strife, will depend entirely upon 
how wisely public sentiment is educated. 

In short, it is self-evident that the one possible perma- 
nent remedy for the unsatisfactory conditions that now 

23 



THE LABORER AND THE CAPITALIST. 

environ the laboring and capitalistic world — the one safe 
way to meet the issue before us — is through a better edu- 
cated public mind regarding the natural relation of capital 
and labor, and the economic principles that must sooner or 
later bind them both. 

Labor began to mutter and organize in good earnest in 
the United States in 1869, when every person had employ- 
ment that wanted it, and the purchasing power of wages 
was vastly greater than the world had before known, and 
nearly double what it was prior to 1860. Thus the question 
is not one of prosperity, but of the distribution of 
prosperity. 

Not long since, near Central Park, New York, one at the 
wealthiest and most distinguished capitalistic lawyers in the 
country addressed the writer substantially as follows : 

"Mr. Willey, there are two sides to the capital and labor ques- 
tion. There is something wrong somewhere when two men, ap- 
parently equal in intelligence, in energy, and in the practice of 
economy, begin business at the same time and place, but at the end of, 
say, twenty years one counts his wealth by the million, while the 
other remains in poverty. This is taking place constantly. We 
see it all around us, and I tell you that while a few live in palaces 
and sweep through Central Park and along our main thorough- 
fares in costly equipages, with train and attendant, so to speak, 
the great mass of hard-working people can never be made to be- 
lieve that there has been a fair division of earnings, and the clamor 
for a more equal distribution of the good things of life will not 
cease while such conditions continue." 

This statement is especially valuable as coming from a 

24 



THE LABORER AND THE CAPITALIST. 

rich man. Then, too, it suggests ideas which are exceed- 
ingly important at this time. It reminds us that there is 
constantly before the laboring-man what to him is an ir- 
refragible argument in support of the theory that he is 
being robbed and his opportunities for material advancement 
destroyed. He casts his eyes abroad and beholds mammoth 
ships on the sea and countless trains on the land ; rich dwell- 
ings and costly business structures tower high in air and 
look contemptuously down upon homeless poverty below. 
He gazes upon these huge piles of wealth and soliloquizes : 
"The great God made the earth and the raw material therein 
for the equal benefit of all his children who are willing to do 
honest work. These bricks have been molded from clay, 
this iron dug from the mines, this lumber culled from the 
forest, these stones cleft from the quarry, brought hither 
and placed in their present proud position by the sons of 
toil, who now own but an insignificant part. Even the 
land, especially that of the cities, is held by the few, and 
the many are excluded. Surely this is not right ; the divi- 
sion between capital and labor has not been just; and if 
ever equal opportunities existed, these vast accumulations of 
wealth have destroyed them and created a gulf between 
capital and labor, between rich and poor, that is becoming 
harder and harder to cross." 

Such are the convictions of labor, and such are the con- 
victions of not a few of the well-to-do and some of the very 
rich. 

There are capitalists who will take all they can legally 
get without regard to the effect upon labor. There are 

35 



THE LABORER AND THE CAPITALIST. 

laborers who would deal just as mercilessly with capital. 
But I believe that in the main both capital and labor desire 
that each shall prosper as they deserve. The trouble is 
they do not see clearly as to what really is deserved, 
therefore each finds it difficult to judge of the motives 
that govern the conduct of the other ; and a long step will 
have been tajien in the direction of lasting peace and a 
more extended brotherly love when it is generally under- 
stood that an honest conviction cannot be suppressed — 
only hindered. 

The opposition to trusts and large aggregations of wealthy 
etc., involves an idea, and the only way to down an idea is 
to argue it down. If it cannot be conquered in that way, 
it is because it is true, and therefore hath eternal life. 

If monopoly, plutocracy, and large fortunes actually stand 
across the people's pathway of advancement, as many beheve, 
their destiny is oblivion sooner or later. It is not more im- 
possible to stop the march of the mighty river which, fed 
by countless streams, leaps Niagara on its way to the broad 
ocean, than to stay the tide of human progress toward a 
larger liberty and a more perfect happiness, the desire for 
which dwells in a greater or less degree in every human 
bosom, in every land, and on every sea. Let us, therefore, 
clear the road by honest thought and by fearless, consider- 
ate, non-partisan debate. 



26 



THE LABORER AND THE CAPITALIST. 
CHAPTER III. 

MONOPOLY. 

Judge David Brewer, of the United States Supreme 
Courtj delivered a speech July 4, 1893 (see New York 
Ind^e'pendent^ J^ly 1"^? 1893), from which the following is 
copied : 

"A capital combine may, as is claimed, produce better, cheaper, 
and more satisfactory results in manufacture, transportation, and 
general business ; but too often the combine is not content with 
the voluntary co-operation of such as choose to join. It grasps at 
monopoly, and seeks to crush out all competition. If any indi- 
vidual prefers his independent business, however small, and refuses 
to join the combine, it proceeds to assail that business. With its 
accumulation of wealth it can afford for a while to so largely un- 
dersell as to speedily destroy it. It thus crushes or swallows the 
individual, and he is assaulted as though he were an outlaw. 

"So it is with organizations of labor ; the leaders order a strike ; 
the organization throws down its tools and ceases to work. No 
individual member dare say, " I have a family to support ; I pre- 
fer to work," but is forced to go with the general body. Not con- 
tent with this, the organization too often attempts by force to 
keep away other laborers. It stands with its accumulated power 
of numbers, not merely to coerce its individual members, but also 
to threaten any outsiders who seek to take their places. Where 
is the individual laborer who dares assert his liberty, and act as 
he pleases in the matter of work ? where is the individual con- 
tractor or employer who can carry on his business as he thinks 
best? . . . 

'*It is true that there is a commendable effort constantly being 

27 



THE LABORER AND THE CAPITALIST. 

made to secure the liberty of the individual ; but are we forever 
to be calling out the militia to protect property from the hands of 
strikers? are the Pinkertons to become a constant factor in our 
civilization ? Is it not time that the dormant energies of our na- 
tion were aroused and a speedy and summary stop put to every 
such trespass on any man's liberty ? Are we going to drift along 
until this contest ends in a bloody struggle ? Must our children 
pay for securing the real liberty of each individual the price that 
the nation paid a score of years ago to abolish human slavery ? '' 

These words of the distinguished jurist are full of serious 
inquiry and solemn import, and all the more so because the 
author is removed from the temptations that so often bias 
the opinion of the politician and the citizen out of office. 
Judge Brewer has practically a life lease of one of the high- 
est of&ces within the gift of the nation, and a guaranty of a 
salary sufficient to more than meet any financial demand that 
is likely to be made upon him. It cannot be denied that 
the conditions exist as he describes them, and that the lib- 
erties of the individual appear at first glance wellnigh 
crushed. 

Here and there is an employer opposed to trusts and 
combines ; but over him hans^s the tremendous weip'ht of 
a vast amount of accumulated wealth ready to crush him if 
he dare assert his individuality. 

Again, there are workingmen who object to combines in 
their ranks ; but they are confronted with an overwhelm- 
ing majority of their kind. In fact, a large preponderance 
of the very energy, capitalistic and laboring, which Judge 
Brewer would summon to break the force of the combines, 

28 



THE LABORER AND THE CAPITALIST. 

has already joined tlie combines or is co-operating with them. 

Then, too, the combines are not without argument to 
support their position and defend their practices, and not 
a few of these arguments are based upon lofty humanitarian 
principles and flow from the purest reason. 

For example, some of the excuses offered for the rigid 
labor code, and the apparently cruel treatment of non-union 
men by their brother-workmen and by labor organizations, 
is that the labor market is so overstocked, and the tendency 
of a certain class to accept wages that will not afford a com- 
fortable living for respectable workmen is so great, that 
severe measures are indispensable to the good of the whole. 

If this argument is not satisfactory to the fullest extent, 
there is, nevertheless, a part that cannot be overthrown. 
The principle that the few must not be allowed to stand in 
the way of the progress of the many is fundamentally correct. 

Regarding capitaHstic combines : The capitalists say that 
the fact that more than thirty per cent, of those who 
engage in business on their own account do not succeed, 
and the multitudinous failures among men with established 
business reputation and once large property resources, 
proves that the margin on capital invested in trade and 
manufacture is ruinously small, and that the trust and com- 
bine are necessary to prevent the fierce competition that has 
so shrunk profits that the equilibrium of commerce and in- 
dustry is everywhere disturbed, and the continued progress 
of business enterprise seriously threatened. 

If these are not valid arguments in favor of capitalistic 
combines, they are certainly very plausible excuses. 

29 



THE LABORER AND THE CAPITALIST. 

However, in the present state of the public mind, what- 
ever of tyranny is practiced by labor organizations is gen- 
erally looked upon as a matter of necessity that has grown 
out of the avaricious conduct of monopolies and the merci- 
less treatment of the employee by the employer, while 
the combinations of capital are popularly regarded as 
entirely unjustifiable — and their growth looked upon as 
dangerous monopoly. 

Most of those who have achieved financial success claim 
that their present wealth, or that the foundation for the 
same, was the result of self-denial and a careful saving of 
earnings at a time when more hours were required for a 
day's work and the wage paid to labor was from 50 to 200 
per cent, below what it is at the present time. As a rule 
these men are the leading monopolists of to-day, and, Hke 
the laborer, they are jealous of what they believe to be 
their rights. They feel that their efforts have not lessened 
the opportunities of the masses, but increased them through 
the opening up of new avenues of trade and by creating 
new demands for labor. Naturally enough, then, they 
regard a great many of the complaints made against monop- 
oly and large fortunes as without excuse and calculated to 
lead to a reckless fanaticism and an unreasoning crusade 
against the rights of property. 

The laborer and the capitalist can be brought to an un- 
prejudiced discussion of the subject of monopoly only after 
a distinct understanding has been reached regarding what 
monopoly is and who are really concerned in it. 

The gist of Webster's definition of monopoly is that it is 

30 



THE LABORER AND THE CAPITALIST. 

" a special privilege/' but this definition scarcely touches 
monopoly as it exists in the United States. 

In olden times, in other countries, special privileges were 
often granted, but a higher civilization has greatly reduced 
the number — indeed, they are rapidly disappearing, even in 
the Old World. 

In our own country there never have been special privi- 
leges worth considering except such as are granted to au- 
thors and inventors. Charters for railroads, banks, joint- 
stock companies, etc., etc., are granted practically without 
limit and for a sum that is merely nominal. 

What our people look upon as monopoly relates not so 
much to the enjoyment of a special privilege as to the 
amount of loealth that is gathered and controlled by indi- 
viduals and corporations. A thousand privileges might be 
granted, but if they did not result in more than an ordinary 
amount of wealth they would not be thought of as monop- 
olies. 

Again, so far as there is any monopoly in this country 
it flourishes as well under the ordinary grants of privilege, 
such as deeds, etc., as under charters. A. T. Stewart be- 
came as much a monopolist in trade without being incorpo- 
rated as Vanderbilt in transportation with his charters from 
State governments. 

Indeed, there is usually greater opportunity to practice 
monopoly under the ordinary grants of privilege than under 
charters, since charters almost invariably carry with them 
restrictions not common to other conveyances. 

So far as it relates to privilege the peanut vendor with 

31 



THE LABORER AND THE CAPITALIST. 

legal permission to control a stated portion of the sidewalk 
has a monopoly no less than the Yanderbilts with their 
railroads. The privilege granted the peanut vendor does 
not prevent others from obtaining like privilege on another 
sidewalk, or on another part of the same sidewalk, for that 
matter; neither does the privilege granted the Yanderbilts 
prevent others from obtaining the right to plant railroads 
wherever such privilege has not already been granted. 

In fact, the only material difference in the monopoly of 
the peanut vendor and that enjoyed by fche Yanderbilts is 
in size, not in kind; in extent, not in principle. 

Grocers, lawyers, shoemakers, etc., are to all intents and 
purposes monopolists. They have a legal and exclusive 
right of possession of a specified property, and under and 
througli such legal right they monopolize their respective 
Hues of business up to the limit of their ability. Who 
does mora or less than this? 



The New York World, April 11, 1892, used the follow- 
ing language : 

"What the country needs is an honest, earnest movement against 
all monopolies and the enactment of laws by Congress and State 
Legislatures that will effectually kiU and bury the evil." 

Suppose we join the New York World y the good chap- 
lain (previously quoted, who thinks "grinding, selfish mo- 
nopoly must cease"), and others holding the same opinion 
(I doubt not they constitute a vast majority of all the 
people) for the purpose of destrojdng monopoly. Where 

32 



THE LABORER AND THE CAPITALIST. 

will we commence ? Where does " grinding, selfish monop- 
oly" begin, and where does it end? 

Let us see; the wealth of earth, equally divided, will 
amount to somewhere in the neighborhood of $200 to each 
inhabitant. Now, if no one individual possessed more than 
$200 of value, what we call monopoly would have no ex- 
istence. The starting-point of monopoly, therefore, is 
where one begins to hold more than an equal share of the 
world's property. The existing condition is that Jones is 
holding $1,000, Brown $5,000, Thompson $10,000, Snyder 
$20,000, Gordon $50,000, Higgins $100,000, Cartwright 
$1,000,000, and somebody else $10,000,000. 

All these are monopolizing vastly more than an equal 
share of the world's wealth. Now, where shall we draw the 
line, and say that those above are harmful and those below 
are not? 

If large monopolists grind and oppress, the same must 
be true of the smaller. Human nature is the same every- 
where, and business methods differ but very little. There- 
fore, if monopolists are crushing the people, ten small ones 
will crush as many below them as one ten times larger will 
crush below it. Where, then, is the logical stopping-place 
in the destruction of monopoly, until no one person is al- 
lowed to hold more property than another ? 

While our means are yet limited and we cut but a small 
figure in the commercial world we are not conscious of being 
monopolists ; yet, if we are not monopolists, what are we ? 
We practice the principle as vigorously as the richest cor- 
poration on earth. In fact, we are precisely where the 

33 



THE LABORER AND THE CAPITALIST. 

great monopolists of to-day once were ; controlling a small 
business, enlarging it as rapidly as possible, and indulging 
tbe hope that sooner or later our possessions will rank among 
the largest in the land. 

There is a sublime sentiment in Whittier's poem entitled 
" What the Voice Said/' which seems to me to apply to our 
case so far as it relates to monopoly. This is it : 

"Earnest words must needs be spoken 
When the warm heart bleeds or burns 
With its scorn of WTong, or pity 
For the wronged, by turns. 

But, by all thy nature's weakness, 

Hidden faults and follies known, 
Be thou, in rebuking evil. 

Conscious of thine own." 

The reader will observe that I have not undertaken to 
discuss the merits of monopoly. I have simply been look- 
ing for the real root and substance of the thing, and trying 
to ascertain our own relations and the relations of all men 
to it. If we have found that, although we inveigh against 
monopoly, we are nevertheless practicing monopoly, it will 
naturally stimulate us to look deeper into the subject, and, 
if we find the principle to be wrong, I trust we shall be 
all the more careful to exercise the precaution suggested by 
the poet — 

"Be thou, in rebuking evil. 
Conscious of thine own. " 

34 



THE LABORER AND THE CAPITALIST. 

CHAPTER IV. 

PLUTOCRACY. 

Let US now glance at that twin brother of monopoly, 
called plutocracy. What is it ? 

Webster^s Unabridged gives the following as the defini- 
tion of plutocracy : 

"A form of government in which the supreme power is lodged 
in the hands of the wealthy classes alone ; government by the rich ; 
also a controlling or influential class of rich men.'*'' 

Of course nobody claims that we have a plutocratic form 
of government; therefore when we speak of plutocrats or 
plutocracy in the United States, we mean rich men who are 
inclined to use the power of their wealth and position to 
control the masses, especially in the realm of poKtics and 
to shape legislation according to their own notion. One 
very important fact necessary to consider in this connection 
is that neither money nor wealth necessarily constitutes one 
a plutocrat. Some of the most influential politicans (politi- 
cal plutocrats) in the United States possess comparatively 
little property. And in the poorer districts are found men 
who cannot command a hundred dollars, yet their pluto- 
cratic power among their fellows is almost absolute ; in fact, 
plutocracy is everywhere. Let us suppose, for the sake of 
argument, that the laboring people undertake to organize a 
party of their own, ignoring all other parties and excluding 
plutocrats. How will they go about it ? The leaders will 
first council together ; but, then, these leaders are plutocrats, 
they dictate the political action of the rest. They are to their 

35 



THE LABORER AND THE CAPITALIST. 

fellows what tlie wealthier political plutocrats are to theirs ; 
and when their organization is complete orders will issue 
from headquarters and pass down the line from plutocrat 
to plutocrat, a:id the rank and file will begin their campaign 
march, keeping step to the music of wage-earning plutocracy. 

We are so unfortunate as to have a class of men among 
us who are unprincipled enough to sell their vote and poht- 
ical influence for money, and the popidar belief is that 
large fortunes are almost the sole progenitors of trading 
political plutocracy. 

Take notice, campaign funds are nor contributed entirely 
by the very rich ; far from it ; indeed, it is often complained 
that the rich are more niggardly in their contributions for 
such purposes than those of smaller means ; and, mark you? 
the less wealthy contributors do not insist that their dona- 
tions shall be honestly used any more than do the richer 
class ; therefore, so far as political funds are used for cor- 
rupt purposes, the small plutocrat is as guilty as the larger. 
Again, the creatures who will sell their vote or poHtical 
influence for money will be governed in their action by the 
" amount going around," as common parlance has it ; that 
is, when but little money is to be had they will sell for less, 
so that if the large fortunes did not exist smaller ones 
would have the same plutocratic power. The corruption in 
politics, then, is not due to the larger fortunes, but to im- 
morality and want of manhood. 

In the popular mind of to-day, the word rich and the 
word plutocrat mean about the same ; to wit, tyranny and 
oppression. 



THE LABORER AND THE CAPITALIST. 

But who are the rich? and where do they reside? 
Mark you, rich and poor are relative terms, and whether 
one is rich or otherwise depends more upon where he is 
located than upon the number of dollars he can command. 

For example : A man is probably richer in the rural dis- 
tricts of New Hampshire with fifty thousand dollars than 
he would be in Boston or New York with a million. The 
greater cost of living and other larger necessary expenses 
would probably consume the million in either city in less 
time than the smaller expenses would consume the fifty 
thousand in the rural district. 

Forty years ago, in that part of the country where I 
spent most of my boyhood, twenty thousand dollars was an 
immense fortune ', a man with ten thousand was considered 
rich ; while one with ^ye hundred was not counted poor. 

One is comparatively richer, and so far as plutocracy can 
affect political results for good or ill he can probably ac- 
complish as much, with one hundred thousand dollars in the 
State of Mississippi, for example, as he can with a much 
larger sum in the State of Massachusetts, the reason being 
that human nature is the same in both States, while the 
average wealth is very much less in Mississippi than in Mas- 
sachusetts. 

Therefore, supposing the citizens to be equally honest 
and equally intelligent, a given number of dollars will nat- 
urally bring much larger results of any kind in the former 
than in the latter State. 

Or, to state substantially the same proposition in another 
way, the lesser capital of the South can control as much in- 

37 



THE LABORER AND THE CAPITALIST. 

fluence, political or what not, in the South, as the larger 
capital of the North can control in the North. 

Therefore, it necessarily follows that there is as powerful 
a plutocracy (if you see fit to call it by that name) in the 
South as in the North — in one part of the country as in 
another. 

Rich plutocrats are few, while plutocrats possessing small 
fortunes are very numerous ; and who can say that one class 
is less to blame for whatever of wrong comes from plutoc- 
racy than the other ? 

Again, if to be rich is to be plutocratic or hurtful to the 
masses, how many are there, even among reformers, who 
are not putting forth their best efforts to become rich, 
which, according to the logic of the hour, will render them 
injurious to their poorer neighbors ? 

In short, is it really anti-plutocracy that is fighting plu- 
tocracy ? or is it the smaller plutocrat fighting the larger ? — 
the unsuccessful complaining against the successful ? 

" We have tried as hard as yourselves, we have employed 
the same business methods, but you have outstripped us in 
the race for wealth ; you have become rich — we have failed ; 
therefore you are a dangerous plutocrat." 

This statement of the case might, without further ex- 
planation, look as if the writer intended to charge those 
who oppose the present regime with hypocrisy and ungen- 
erous conduct toward their competing brothers who have 
gained more property or influence than themselves. Such 
is not intended, however. The statement is made simply 
to show the universality of plutocracy. 

38 



THE LABORER AND THE CAPITALIST. 

Those who are agitating against plutocracy and monopoly 
are not necessarily dishonest, nor do they mean to be un- 
generous toward others. It should be stated, however, 
that the masses have not gone far enough into the subject 
of plutocracy to comprehend its reach, the ground it covers, 
and the logic their position involves, and especially do they 
fail to reahze how far they are willing to practice, and in 
fact do practice in business and in politics, the very prin- 
ciple which they so earnestly condemn as plutocratic and 
wicked. 

There are many wrongs to be righted, but let it be re- 
membered that whoever attempts to pluck the mote from 
his brother's eye while the beam yet remains in his own 
cannot succeed. 



CHAPTER V. 

THE WIDER VIEW. 

The essence of plutocracy is found in monopoly, and for 
the sake of convenience we will, for the time being, consider 
both as expressed in the term Monopoly. Whoever takes 
the larger view of monopoly cannot fail to be impressed 
with the thought that the masses in all civilized countries 
are freer, wiser, more refined, and possess more property 
than they did a century ago ; and that all this has come to 
them, notwithstanding the existence of monopoly. 

It may be fairly claimed that institutions and things that 

39 



THE LABORER AND THE CAPITALIST. 

stand in the way of human progress cannot endure. Pesti- 
lential diseases^ once the terror of every clime, are dis- 
appearing before the march of science, and human life 
lengthens as the years roll on : famine, with its long train 
of human woes, and religious intolerance, with its merciless 
fagot, are retiring to more benighted fields ; peaceful arbi- 
tration is taking the place of war, so that that bloody rehc of 
barbarism, unable to stand the light of modern civilization, 
is taking up its march to join the retreating plagues of a 
more ignorant and despotic past. Not so with monopoly. 
As wisdom, goodness, refinement, and liberty have increased, 
so has monopoly. 

Now, since all these have flourished side by side from 
century to century, without the first visible sign of decay in 
either, each witnessing progress in the other corresponding 
to its own growing greatness, may it not be that a harmony 
exists hetween the pri7ieiple of monopoly and the commonly 
accredited elements of human progress, hitherto undiscov- 
ered by the multitude ? 

That some friendly relationship does exist between mo- 
nopoly and the higher development of our race seems to be 
clearly indicated in the fact that that which we call mo- 
nopoly begins under the protection of law, whicli is the in- 
evitable result of civilization, the natural outgrowth of 
cultivated mind. 

It cannot be denied that these statutes are spurs to im- 
provement and noble endeavor. The son of the forest 
leaves his savage haunts and his home in the wood and 
submits to the more rigorous discipline of civilized life 

40 



THE LABORER AND THE CAPITALIST. 

largely on account of the protection it affords him. Here 
he may monopolize the results of his own labor ; he may 
fence in the land from which he digs a Hvelihood. He 
toils, accumulates, and beautifies under the promise that he 
shall not be obHged to yield up his possessions to whoever 
may chance to command a swifter arrow or wield a more 
deadly tomahawk. 

If we reason from effect back to cause we find that 
monopoly flows from a principle irrevocably established in 
the very heart of nature and exemplified in a greater or 
less degree in every son and daughter of earth. 

The average man dwindled and dwarfed in the majestic 
presence of Daniel Webster. The common debater went 
down before his logic and eloquence. Before high tribu- 
nals, where ordinary talent dared not venture, Webster's 
career was a conquering march. Many a lawyer fell by 
the wayside, while Webster went on cleaving his way 
through courts and Senates. All this was the necessary 
outgrowth of extraordinary talent centered in a single 
human being by an infinite creative Power. In other 
words, Webster was one of nature's great monopolists in 
the domain of intellect. His talent and stamp of mind led 
him to pre-eminent success in one direction; the same de- 
gree of what is called financial talent would have led him 
to success correspondingly great in commercial enterprises. 
This means what? It means that, as a rule, large accumu- 
lations of mental power and learning and large accumula- 
tions of material wealth may be equally the product 
of nature, both originating in the constitution of the 

41 



THE LABORER AND THE CAPITALIST. 

human mind and in surrounding conditions not created by 
man. 

Or, to state the fact in another way, Webster's ability to 
monopolize the attention of the world, secure the most im- 
portant cases before the courts, and frequently to control 
public events beyond most other men, was the result of 
forces which he did not generate. 

The results that followed were not pleasing to some of 
the lesser lights, because Webster monopolized so much of 
a kind of practice and consideration which they coveted. 
Nevertheless, other lawyers were not hindered by Webster's 
success; the light of his mighty intellect shone in every 
direction, and those below him became more successful 
practitioners in consequence. 

The power to generate great ideas, the power to command 
great armies, the power to make great discoveries in the 
fields of science, the power to move the world with tongue 
or pen, the power to originate and conduct great industrial 
enterprises and accumulate large fortunes, — always has been 
and always will be the inheritance of the few. 

The popular belief is that such men, in originating and 
controlling great enterprises, corporations, etc., become pow- 
erful centralizing forces, destroying the opportunities of the 
many. This question will be the subject for discussion in 
the next chapter. 



43 



THE LABORER AND THE CAPITALIST. 
CHAPTER VI. 

DO CORPORATIONS CONCENTRATE WEALTH? 

The Rev. Josiah Strong, D.D., General Secretary of the 
Evangelical Alliance for the United States, has written a 
very interesting book entitled " Our Country." It is gain- 
ing a very wide circulation ; clerg3niien are quoting it ex- 
tensively. The introduction is from the trenchant pen of 
Prof. Austin Phelps, D.D. In the chapter entitled " Perils 
of Wealth," pages 174-175, appears the following : 
"It is the tendency of our civilization to destroy easy gradation 
from poor to rich, which now exists, and to divide society into only 
two classes — the rich and the comparatively poor. In a new 
country almost any one can do business successfully, and broad 
margins will save him from the results of blunders which would 
elsewhere be fatal. But with growing population and increasing 
facilities of communication, competition becomes severe, and then 
a slight advantage makes the difference between success and fail- 
ure. Accumulated capital is not a slight but an immense advan- 
tage. " To him that hath shaU be given." There will^ there- 
fore^ he an increasing tendency toward the centralization of great 
wealth in corporations^ which will simply eat up the small dealers. 
As the two classes of rich and poor grow more distinct they will 
become more estranged, and whether the rich, like Sydney Smith, 
come to regard poverty as " infamous " it is quite certain that many 
of the poor will look upon wealth as criminal." 

Dr. Strong's idea is that corporations are destroying " the 
opportunities to pass from the lower grade of society to the 
higher," and that " there will he an increasing tendency 
toward the centralization of great wealth in corporations,^^ 

43 



THE LABORER AND THE CAPITALIST. 

A gentleman informed me that while he was a member of 
a Western Senate his constituents kept his desk piled high 
with letters warning him not to jeopardize his own and their 
interests by yielding to the demands of associated capital. 
" Beware of corporations " was the cry from every point of 
the compass. 

The prejudice against corporations has arisen mainly from 
their supposed tendency to concentrate wealth in the hands 
of a few, and to lessen the opportunities of the many to 
enter business on their own account, or to obtain a fair 
share of the results of the joint efforts of capital and labor. 
The public mind has been so deeply engrossed with this 
theory that it has not taken sufficient time to consider the 
subject of corporations thoroughly. 

Corporations are a necessity of our civilization. In fact, 
they have aided civilization, and civilization has aided them. 
Indeed, corporations were born of civilization, and nothing 
less than associated capital as it appears in corporations 
could have produced the magnificent results we see all 
around us. Scarcely a mine has been opened, a ship 
launched, a mountain tunneled, a railroad built, a factory 
reared, or a telegraph wire suspended in the air that has 
not been accomplished, directly or indirectly, through cor- 
porations. Why, then, should they make it harder for the 
people to rise to a more independent position ? Why should 
they centralize the results of toil ? In other words, what 
interest has a corporation that is not common to everybody ? 

It is ordained that an infinite variety of dispositions, as- 
pirations, and capabilities should exist together in the human 

44 



THE LABORER AND THE CAPITALIST. 

family, but the infinite beneficence and wisdom of the 
Author of nature has linked the interests of all in one end- 
less chain of universal brotherhood. One man can walk 
faster than another, because he has longer, stronger, or 
more nimble hmbs. The lightning calculator can out- 
reckon the average mathematician, because he has greater 
mathematical talent. One can accumulate wealth more rap- 
idly than another, because he has more financial ability or 
more favorable opportunity. But the interest of one always 
remains the interest of the whole. To illustrate : 

In a certain neighborhood there are three physicians. 
It is safe to say that one of these does as much as the other 
two combined. In other words, one physician monopolizes 
one-half of the practice of the neighborhood, and it may 
be added that he does it just as effectively as if the govern- 
ment had granted him the exclusive privilege. 

There are traders in the same locality equally successful 
in their fine. They outstrip their competitors, and at the 
same time treat their customers just as well or better. 

These men, and men like them, soon possess more prop- 
erty than the average citizen. They are quick to see busi- 
ness openings. It may be that a new railroad promises the 
best results. They combine their surplus capital, procure 
a charter, and build the road. Their interests are no less 
interwoven with the interests of the people now than before. 
As physicians and merchants, in order to secure the best 
results for themselves, they were obliged to locate where they 
were the most needed. Then, in order to be secure them- 
selves and to make headway against those who were already 

45 



THE LABORER AND THE CAPITALIST. 

competitors, or liable to become so, they were obliged to 
treat the public justly and kindly. The same consider- 
ation of self-interest will necessarily govern these men in 
planting and operating their railroad. For their own 
gain, they will locate where the people most need it, and 
carry as cheaply as possible to avoid the danger of compe- 
tition. 

There is, therefore, no natural reason why corporations 
should not promote the interests of rich and poor alike. 

Here comes to mind a conversation with a Wall street 
lawyer who had been employed to prosecute the Standard 
Oil Company in a case, the particulars of which he did not 
relate. I inquired concerning the business methods of that 
famous corporation. 

He thought the concern very cruel, and gave it as his 
opinion that whoever undertook to defend it would land on 
the lee shore. 

I told him I had not the slightest desire to defend the 
Standard Oil Company, since I had never had any con- 
nection with it. I was after the economics of the 
concern. 

It would probably be as difficult to justify all the busi- 
ness conduct of the Standard Oil or any other corporation 
as it would be to furnish a complete defense for all the 
business schemes of individuals. 

As has been stated in a previous chapter, the people do 
not regard themselves as at all connected with what they 
call monopolies (corporations). On the contrary, they look 
upon whatever wrong, or apparent wrong, these institutions 

46 



THE LABORER AND THE CAPITALIST. 

are guilty of as entirely the fault of capital — they call it 
the greed of capital. Therefore they are not in a frame 
of mind to treat the subject with the candor it deserves. 
A just and dispassionate consideration of the subject of 
capital and labor in all its bearings can be had only when 
the masses fully realize the logic of their own position 
toward large aggregations of wealth and the perfect blend- 
ing of their interest with that of capital, and how exactly 
like the large capitalist the small capitalist is. 

Members composing large corporations are not more 
avaricious than the world of people about them ; but, for 
the sake of the argument, and for the purpose of bringing 
into a clearer light an important principle, we will suppose 
the Standard Oil Company, for example, to be composed 
entirely of avaricious people. Now, how does it monopo- 
lize so much of the oil trade ? 

A friend, who has been trying to produce oil in a small 
way answers the question. He says he cannot succeed 
owing to the fact that the Standard Oil Company sells its 
product at so low a rate. For this he blames the company. 
Why not blame the people as well? 

The company offers oil at a price which the people know 
will crush small dealers, yet they purchase at that figure. 
On the principle that the receiver is as bad as the thief, if 
the company is guilty the people are not innocent. Or, to 
state the substance of the matter in another way, the com- 
pany sells at a low price to control the trade and to make 
money ; the people buy at a low price to save money. Both 
are looking out for themselves, and leaving the small dealer 

47 



THE LABORER AND THE CAPITALIST. 

to look out for himself. If the company is cruel, what 
shall we say of the people ? Or, if " avarice " is the word to 
use, who will say that the Standard Oil monopoly is not 
as much the result of the avarice of the people as of the 
company, since the people do not come to the rescue of 
the small dealers by offering them a higher price for oil? 

But, leaving all this out of the question, does the Stand- 
ard Oil Company concentrate wealth in the hands of a 
few? 

Imagine the American people contracting for ten million 
barrels of oil. A hundred small firms can furnish one 
hundred thousand barrels each at a certain figure ; but the 
Standard Oil Company, owing to its greater wealth and 
larger facilities, can afford to discount the offer of the 
small firms, say twenty cents on a barrel. This will save 
the people f 2,000,000 on their purchase. Now, is it not 
just and humane — in other words, will not the greatest 
good come to the greatest number, and will not wealth be 
more diffused — through letting the contract to the Standard 
Oil Company? 

If we patronize the hundred small firms we must pay a 
higher price for kerosene. Can we afford it? Can the 
people, for the sake of keeping the small firms in existence, 
afford it? Such a course would please the small firms, 
since it would lodge $2,000,000 of the people's money in 
their pockets, but is it not better for the people to keep this 
money in their own pockets? 

Now, the popular question will be, Shall we allow the one 
concern such power of monopoly, and thus permit the profits 

48 



THE LABORER AND THE CAPITALIST. 

of the ou trade to center in the hands of one great corpora- 
tion? 

The public does not consider that by patronizing the 
Standard Oil Company we practically distribute (leave un- 
collected) the $2,000,000, more or less, which the company 
discounts among sixty millions of people, instead of col- 
lecting and concentrating it in the hands of small firms. 

Neither has it dawned upon the masses that a great many 
more individuals with small means are interested in the oil 
trade on account of the Standard Oil Company than could 
possibly be interested if the business was in the hands of 
private firms. The machinery and other things necessary 
to produce oil in any considerable quantity cost no small 
stun, and a man's wealth must reach well into the thousands 
in order for him to engage in the production of oil on his 
own account with any prospect of success ; but about one 
hundred and eighty dollars will give one an interest in the 
Standard Oil Company at the present time. The small 
amount of money required to purchase a share of stock has 
given an opportunity to people of very limited means to 
share in the profits of the oil trade, and has placed the prop- 
erty of the Standard Oil Company in the hands of a great 
many people (about four thousand). Hence, whatever of 
profit we pay to that corporation is more widely distributed 
than if we paid it to private firms, while not a single laborer 
less is employed in the oil business. 

In short, this subject may be summed up as follows : The 
Standard Oil Company supplies us with oil at lower rates 
than smaU manufacturers can afford; it offers the smaller 

49 



THE LABORER AND THE CAPITALIST. 

capitalists an opportunity to invest and share its profits ; it 
employs all the labor that can be employed in the business, 
whether the oil is furnished by few or many firms, and it 
diffuses wealth more generally than private firms can. 

What is true of the Standard Oil Company, so far as it 
relates to the distribution of wealth, is true of corporations 
generally. But the fact that private firms have sometimes 
been driven out of business by the larger concerns has so 
riveted the attention of the public and so aroused popular 
sympathy for the small dealers, that the co-operative and 
distributive nature of corporations is almost entirely over- 
looked. 

The popular feeling and method of reasoning regarding 
this matter are well illustrated in a few words by the Rev. Dr. 
Strong, which I requote from his statement on page 43, 
as follows : 

"In a new country almost any one can do business successfully, 
and broad margins will save him from the result of blunders 
which would elsewhere be fatal." 

Dr. Strong's theory is that because accumulated capital 
as it is found in corporations is a great advantage to the 
wealthy, and has the effect to reduce margins (profit), it 
therefore has the further effect to lessen the opportunities 
of individuals of small means to enter business and realize 
profits for themselves. This is generally regarded as tyr- 
anny natural to corporations, which means the destruction 
of liberty sooner or later unless something extraordinary is 
done to prevent it. 

50 



THE LABORER AND THE CAPITALIST. 

But tlie all-important fact in the case is that the difference 
in the larger profit from trade and manufacture which ruled 
before the days of great corporations, and the smaller profit 
now received, goes to the people instead of to the traders 
and manufacturers, as it formerly did. 

To illustrate : We will go back thirty years, during which 
time the growth of corporations has been the most rapid, 
and say, without attempting to be accurate, that the average 
business of the country has been thirty billions per annum, 
and that the average profit to manufacturers and traders 
would have ordinarily been ten per cent., or three biUions 
per annum — ninety billions in thirty years — but the growth 
and competitive power of corporations have reduced those 
profits, say twenty per cent., or eighteen billions in thirty 
years. These eighteen billions, then, represent the amount 
which the people have retained of the profits of industry, 
which would have gone into the pockets of manufacturers 
and traders but for the severe competition of corporations, 
which Mr. Strong and so many intelligent and cultured 
people like himself think are eating up the results of toil. 
All this vast sum of money has passed through the peo- 
ple's hands for food, clothing, homes, etc., etc. And, mark 
you, no less labor has been employed, and a higher rate 
of wages has prevailed. 

How then do great corporations concentrate wealth? 
Why do they not benefit rich and poor alike ? Indeed, if 
statistics can prove anything, then it is proved that cor- 
porations do benefit rich and poor alike. Let us see if 
this is not correct. 

51 



THE LABORER AND THE CAPITALIST. 

On pages 102 and 103 of the statistics of Massachusetts 
Manufacturers^ issued by the Labor Bureau, for 1887 and 
1888 appears the following : 

*^In 1887 the number of corporations represented in one thou- 
sand and twenty-seven (1,027) establishments compared, is but 
31.45 per cent, of the total number of establishments, and only 
45.83 per cent, of the number of private firms; yet, these corpora- 
tions represent the interests of 49.07 per cent, of the total number 
of investors, and the number of stockholders is more ^ha^n fifteen 
times the number of jyartners,'^'' 

These data prove beyond cavil that the tendency of cor- 
porations is not to concentrate the profits of industry in the 
hands of a f ew, but to diffuse them among the many. 

Or, to state the same fact in another way, the corpora- 
tions in question have increased the opportunities of the 
people to become manufacturers and sharers in the profits 
of business, fifteen-fold over a proportionate number of 
private firms. 

The report continues as follows : 

*'In the manufacture of cotton goods, the 30 private firms rep- 
resent only 58 persons, while the 81 corporations have their capital 
stock diffused among 13,901 persons. '' 

Mark you, thirty private firms represent only 58 owners, 
while 81 corporations represent almost 14,000 owners. 

Here is an appropriate place for a statement by a lady 
writer. (See Ameriaan Woman's Journal for October, 
1893, page 72, as follows :) 

'^Four hundred years ago, when Columbus came ta AweriQa, the 

52 



THE LABORER AND THE CAPITALIST. 

squaw toiled for her dusky chief; to-day our women drudge for 
aliens and soulless corporations." 

This represents the idea prevalent among very many in- 
telligent women, at least so far as it relates to the relation 
of corporations to the female portion of our population; 
but the report from which I have just quoted shows a 
state of facts which, when they come to be understood, will 
reverse that opinion. For example, it is there shown that 
in 708 private firms 29 of the investors were females, while 
in only 319 establishments conducted by corporations, there 
were over 6,000 female investors. In other words, where 
the manufactories were in the hands of private firms, there 
was only one female owner to about fifty male, while in the 
corporations there were almost half as many female as male 
owners. 

Therefore these corporations have increased the oppor- 
tunities, not only of poor men, but poor women, to invest 
their small earnings and become sharers in the profits of 
business on the whole more than fifteen-fold. 

The fact that corporate organizations throughout the 
country are a means by which the profits of industry are 
more evenly distributed cannot be questioned any more 
than in the case of the Massachusetts cotton manufactories. 
It is a matter of figures and a thing of record. The price 
of the shares of stock and the number of investors are 
a mathematical demonstration that does not admit of 
doubt. 

Therefore we know to a mathematical certainty that the 
tendency of corporations is not to concentrate, but to dif- 

53 



THE LABORER AND THE CAPITALIST. 

fuse, the results of industrial energy; not to lessen the 
opportunities of the many, but to increase them. 



CHAPTER YII. 

RICHES AND HONESTY. 

In the chapter on " Perils of Wealth," pages 174-5 of 
Dr. Strong's work before quoted, appears the following : 

'^ Superfluity on one hand and dire want on the other — the mill- 
ionaire and the tramp — are the complement of each other. The 
classes from which we have most to fear are the two extremes of 
society — the dangerously rich and the dangerously poor ; and the 
former are much more to be feared than the latter." 

Following this statement of the learned D.D., and on 
the same page, the distinguished Dr. Crosby is quoted as 
follows : 

"The question which threatens the uprooting of society, the dem- 
olition of civil institutions, the destruction of liberty, and the 
desolation of all, is that which comes from the rich and powerful 
classes in community." 

On page 173, same chapter, appears the following : 

"We have indeed some rich men who are an honor to our civiH- 
zation ; but the power of many millions is almost certain to find 
its way into strong and unscrupulous hands." 

Note the words following the last semicolon — " hut the 
power of many millions is almost certain to find its way 
into strong and unscrupidous hands.'^ Again, note the 

54 



THE LABORER AND THE CAPITALIST. 

first sentence in tlie quotation from Dr. Strong : " Super- 
fluity on one hand and dire loant on the other — the mill- 
ionaire and the tramp — are the complement of each 
otherT 

The belief that generally the larger fortunes are in the 
hands of those who are unscrupulous and selfish above or- 
dinary mortals has given rise to a great deal of unpleasant, 
not to say violent, feeling. It moved a member of the Wo- 
man's Convention at Washington, D. C, in 1892, to declare 
that she would follow the capitalist from the banks of Wall 
street to the gates of hell. It made the Masonic Temple, 
Twenty-third street. New York, resound with applause 
when Hugh 0. Pentecost declared that " a drop of blood 
must flow for every tear that had washed the cheek of toil." 

Now, it is no answer to the laborer and his friends to 
call them fanatics, etc., etc. Dr. Strong believes that the 
tramp exists because the millionaire exists; that is, the 
million has been taken from the laborer, which has made 
him a tramp ; and Dr. Strong is not a fanatic. He is an 
able and considerate person. Ex-Senator Ingalls does not 
beheve that a hundred thousand dollars were ever honestly 
earned by one man ; and Mr. Ingalls is not a fanatic. He 
is simply brilliant and full of generous impulses. The 
editor of the Labor Leader, before quoted, beheves that 
most of our very rich men may be justly accused of having 
committed robbery ; yet when I met that editor in Boston 
he appeared like an intelligent, sincere man, not given to 
fanaticism. 

The principle I desire to most emphasize at the present 

55 



THE LABORER AND THE CAPITALIST. 

moment is explained by historical facts concerning three 
distinguished individuals, as follows : 
A New York divine lately said : 

"We read in history that in May, 1775, George Washington on 
his way to Congress met the Kev. Jonathan Boucher in the middle 
of the Potomac. While their boats paused the clergyman warned 
his friend that the path on which he was entering might lead to a 
separation from England." 

" If you ever hear of my joining in any such measure,'* said 
Washington, " you have my leave to put me down for everything 
wicked." 

George Washington was a very great man, yet he was 
not among the earliest to see the approaching revolution 
which was then so near, and he was much later than many 
of his illustrious contemporaries in feeling the necessity for 
an independent government for the colonies. But Wash- 
ington was honest as well as great, and when he saw the 
right he embraced it, and the world will never forget how 
bravely and uprightly he walked in his newly discovered 
path of duty. 

Benjamin Franklin was a very honest man, and as to in- 
telligence it is the opinion of the writer that rarely, if ever, 
has a mind appeared in history whose march through the 
universe of knowledge was more majestic and sweeping, 
and at the same time powerfully searching, than that of 
Franklin. Yet near the close of his illustrious career, when 
asked for his opinion on some intricate subject, the great 
philosopher replied : " Really, I am loth to give an opinion, 
I have been obliged to change my mind so often." 

56 



THE LABORER AND THE CAPITALIST. 

In the ever memorable debate between Webster and 
Hajne in the United States Senate, Hayne attempted to 
weaken the force of Webster's argument by referring to 
what he regarded as a great inconsistency in his political 
career, to wit : He had once been a free trader, but now he 
was found advocating a protective tariff. Webster admin- 
istered a few words of scathing rebuke to the theory that 
consistency demanded that one should always be found sup- 
porting the same policy, and then vindicated himself with 
the words : " I saw reason to change my mind." 

The more intelligent and progressive a man is — the more 
determined he is to be right — the further he wp.des out 
into the great ocean of facts and figures and mystery, the 
oftener he comes into contact with larger truths and sterner 
difficulties, and the more frequently he is obliged to change 
his course. 

Show me a man who has never found himself on the 
wrong road, and I will show you a man who has always 
tarried very near the spot where he was born, and whose 
fund of knowledge corresponds very nearly to the small area 
within which his footsteps have been confined. Some one 
has well said : "A wise man changes his mind ; a fool never." 

The moral inculcated is not that the opinions of great 
men should be disregarded. But all history, and all ex- 
perience with the frailties and blunderings of even the 
purest and most reliable of human beings, bid us to think 
for ourselves. There is a vast deal of right reasoning 
from wrong premises, and very much harm has come to the 
world from that source. 

57 



THE LABORER AND THE CAPITALIST. 

Men, distinguished for talent and goodness, have ad- 
vanced theories ; the lesser lights have taken them up and 
heralded them abroad, and the masses have embraced them, 
not because they have reasoned them out for themselves, 
but on account of their respectable origin ; and hate and 
carnage and misery have many 'times followed, when 
scrutiny under the light of a fearless and cultivated reason^ 
would have led to very diferent results. The sincerity and 
ability of those quoted regarding the dishonesty, etc., of 
the rich have been freely admitted; and I am encouraged 
to frankness in the turther discussion of the subject by the 
thought that I am dealing, not with a class of cranks (al- 
though there are cranks among them as there are in all 
classes), but with men and Avomen, not a few of whom are 
found among the most learned and intelligent of earth, and 
whose moral sensibilities are so highly developed by disin- 
terested thinking that they feel the sufferings of others 
more keenly than the average individual, and fly earlier to 
the defense of the wronged and to the support of the weak. 

But it is human to err, and even the wisest and best can- 
not always avoid mistakes. 

This chapter is not intended to be an exhaustive discussion 
of the comparative honesty of the rich, or of the rich and 
the poor ; only to throw out a few hints and establish cer- 
tain facts necessary to an unprejudiced consideration of the 
chapters that follow. 

In the first place, if we assume that the very rich have 
necessarily robbed to get their wealth, we are immediately 
perplexed by the question previously discussed, to wit, 

58 



THE LABORER AND THE CAPITALIST. 

Who are the very rich, and where do they reside? A 
miUion is not so very rich for New York, while fifty 
thousand is an immense fortune in some other towns. 
And the former sum may be as easily won in New York 
as the latter sirni in some other locaHties. AYhere, then, 
shall we draw the line and say that all, or even a large 
percentage, or any number, for that matter, of the fortunes 
above a certain amount are the result of dishonesty, while 
those below are not ? Ordinarily this question alone 
would make clear the impossibility and irrationality of at- 
tempting to establish a man's character for either honesty 
or dishonesty by the size of his fortune. 

However, the belief that most men of great wealth are 
necessarily dishonest is based upon the further behef that 
it is not in the power of any one man to honestly earn what 
to-day is called a large fortune in our leading cities, for 
example. It will be remembered that ex-Senator Ingalls 
was cheered by a very large religious audience when he ex- 
pressed a doubt as to whether any one man ever honestly 
earned a hundred thousand dollars. Mr. Bellamy infers that 
because a small boy would be suspected of having come dis- 
honestly by a thousand dollars, should that sum be found in 
his possession, it therefore follows that a man found with 
a million has got more or less of what belongs to others. 
But where is the parallel ? 

Should you meet a bright boy, whom you knew had been 
in business quite a length of time, with a splendid oppor- 
tunity to make money, you would not think it strange if 
he had a thousand dollars on hand. 

59 



THE LABORER AND THE CAPITALIST. 

Most o£ our very rich men have been doing an immense 
business for from 20 to 50 years. Therefore Mr. Bellamy's 
argument does not reach the case. 

You may select men among the most distinguished in 
their respective callings, say the Yanderbilts in railroading, 
the Rockefellers in the oil trade, Wanamaker in dry goods, 
Dolan in the woolen industry, Carnegie in the iron, and as 
many others like them as you please, and, as a rule, their 
fortunes will be found to represent a smaller profit in pro- 
portion to the amount of business transacted than does that 
of the average trader whose property is valued at say 
twenty thousand dollars. 

Capital stands guard over capital and will not allow rich 
business men to rob the pubHc for any great length of time. 

Have you ever seen two men angling for trout and not 
noticed the anxious look of one when the other has drawn 
a fine speckled fellow from the sparkling stream ? If a 
second is caught in the same place, the less successful an- 
gler is sure to cast his hook there also. The same is true 
of capitalists. Where one succeeds, another is bound to 
try. Money is seeking investment, and the hour that cap- 
italists can see how they can pay the present rate of wages, 
and at the same time undersell or treat the public in a man- 
ner that will take business from our commercial giants, they 
will try it on, as the saying is, and the present leaders in 
trade and traf&c will be obliged to change their methods or 
step down and out. 

MilHons are sometimes dishonestly won, so are smaller 
amounts, even pennies, for that matter. Again, some men 

60 



THE LABORER AND THE CAPITALIST. 

blunder into wealth — boring for water, they strike oil ; 
digging for clams, they find gold — but, as a rule, large 
fortunes are the result of business energy and sagacity 
above the average, and they are usually gained with an 
advantage to the people corresponding to their size. 

To illustrate : Jones stands before a mountain rich with 
ore, but he is timid and doubtful ; the opportunity looks 
like a good one, but he does not feel quite certain. He 
attacks the mountain, but not resolutely. He employs, 
say, ten hands, pays each $2 per day, and realizes a profit 
of twenty cents on each hand. At the end of twenty years 
he is worth twelve thousand dollars. 

You attack the same mountain at the same time, but you 
are resolute and daring ; you see your opportunity, and 
doubt not. You engage a thousand hands, pay each $2 
per day, and if the mine yields as well for you as for Jones, 
your profit will be two hundred dollars per day. At the end 
of twenty years you will be worth more than a million dollars. 

Now how can it be said that you have not earned your 
million as honestly as Jones has earned his twelve thousand ? 
You have paid the same rate of wages. The difference in 
wealth simply represents the difference in courage, in en- 
terprise, in sagacity, and in the number of hands employed. 
Therefore, should society take hold of your neck, as Bel- 
lamy suggests, and ask you to account for having a hun- 
dred times more wealth than Jones, you can answer that 
you have transacted a hundred times more business, and 
employed a hundred times more labor, or done a hundred 
times more for wage-earners, which means the same. 

61 



THE LABORER AND THE CAPITALIST 

A very large majority of our rich men come under this 
head. The wealth they accumulate is not, as a rule, out of 
proportion to the business they transact for themselves, and 
create for the world, and the employment they give to 
labor. 

Our own every-day experience and observation, if we 
will but stop to think, must lead us to the conviction that 
the rich are as honest as the poor, and that millions are as 
fairly gained as thousands. 

When the noble founder of the New York Tribune passed 
from earth he had acquired, from first to last, and had he 
seen fit might have had on hand as the result of his talent 
and energy, more than one milhon dollars. He left his 
children above a hundred thousand. Was he dishonest? 
I do not believe a man lives, or has ever hved, less likely to 
accept a dollar not honestly earned than this disinterested 
friend of the poor and dauntless champion of equal rights. 

Peter Cooper acquired wealth, so that after he had scat- 
tered with a liberal hand among the poor, given bounti- 
fully to numerous enterprises for the good of his own and 
coming generations, reared and endowed with princely 
munificence that grand institute known as the Cooper Union, 
he had more than two million dollars left. This is a fortune 
twenty times larger than Senator Ingalls and his vast audi- 
ence thought could be honestly earned by one man. Was 
the great philanthropist dishonest? There is no reason to 
question the honesty of Socialists, yet where in all their 
ranks can be found one possessing more of that priceless 
gift than did grand old Peter Cooper? 

62 



THE LABORER AND THE CAPITALIST. 

I will not undertake to say who has obtained his property 
honestly, whether he has much or little ; but large and 
small fortunes are won by the same business methods. And 
certain it is that no natural or scientific reason can be 
given why millions are not, as a rule, as honestly earned as 
thousands. 



CHAPTER YIII. 

THE GROWTH OF SOCIALISM, 

When the masses are considered in the clear light of 
principle — the business methods they employ, apparently 
without scruple, the ambition they display in pursuit 
of gain, and the treatment they bestow upon their fel- 
lows when their own pecuniary interests are at stake — there 
is no general or material difference between the average 
among those who are now assailed as monopolists and pluto- 
crats and the average among the masses, except in the 
degree of success that has attended their financial efforts. 

It has been shown that monopoly and plutocracy do not 
abide with the rich alone, nor with any one political party, 
but that they dwell equally with all parties and pervade all 
localities, the rural and sparsely settled school district not 
less than the densely populated metropolis. Also has it 
been shown that monopolistic and plutocratic power cannot 
be divided, and one portion called large and the other 
small, one strong and the other weak, one harmless and the 

63 



THE LABORER AND THE CAPITALIST. 

other dangerous, — for the all-suiBicient reason that one divis- 
ion cannot accomplish anything large without the assist- 
ance of the other. 

These facts are an argument against some of the leading 
claims of existing political parties and factions, and they 
show a degree of very harmful inconsistency in many po- 
litical speeches and essays, which the authors thereof 
have not yet discovered, but which the calmer second 
thought will reveal to their understanding. There needs 
to be cultivated a more general disposition to discoun- 
tenance hasty denunciation, and to search more carefully 
for first principles, lest our preaching and practice clash 
when we are not aware, and our well-meant efforts for 
good become unavailing. And above all must this great 
question of capital and labor be lifted out of the mire of 
party politics into the broader field of nonpartisan debate 
and the purer atmosphere of disinterested judgment. 

The socialistic party is the only organization which know- 
ingly and openly declares against the private ownership of 
property. It is, therefore, the only organization which 
accumulated and accumulating wealth has to fear as a 
finality, and it is the only organization which proposes any 
form of government differing very materially from such 
as now exists in the United States. Therefore the ques- 
tion as to whether the element of Socialism is grooving 
stronger or weaker, and what the arguments are that give 
it life and power, is important. 

In Germany the ballots cast by the Socialist party num- 
bered 780,000 in 1887, and 1,800,000 in 1893. That was 

64 



THE LABORER AND THE CAPITALIST. 

a tremendous increase in the Socialist vote of Germany. 
In Germany, however, Sociahsm has been greatly persecuted. 
Therefore, when an opportunity is offered it acts more as a 
unit, and the increase in the vote cast shows approximately 
the growth of the Socialistic sentiment in the country. 

Not so in all countries, however. Where persecution has 
been less severe. Socialistic elements have not formed the 
habit of coalescing and acting together. Neither is the 
sentiment as radical and ripe (except with a small faction) 
in most other countries as it is in Germany. But the feel- 
ing in favor of an associated effort on the part of the masses, 
including vast numbers in the learned professions and in 
the higher walks of life, to secure government interference 
in the interest of labor as against capital, is making as rapid 
headway in other countries as in Germany. 

The Morning Press (before quoted) December 17, 1893, 
had an account of a debate among some of the leading cler- 
gymen of England, as follows : 

"The Bishop of Eochester and Eev. Scott HoUand, famous rep- 
resentatives of the Established Church ; Rev. Hugh Price Hughes, 
the leading Dissenting preacher of Great Britain since the death 
of Spurgeon ; and Dr. Dykes, representing the Estabhshed Presby- 
terian Church of Scotland, agreed in advocacy of the resolutions 
that " the principle of the maintenance of a standard of decent 
living should be recognized as an essential condition of the settle- 
ment of labor disputes." Fearing the resolution would be adopted, 
the Dean of Westminster refused to let it be put to the vote, but 
the expressions in its behalf were so many and so strong as to 
show a widespread belief in the description of it given by the 

65 



THE LABORER AND THE CAPITALIST. 

Eochester bishop as " merely setting up the greatest of Christian 
principles." 

There is no mention of Socialism in this account. But 
it shows the trend of religious opinion in England. Of 
course, the result contemplated by these clergymen would 
be expected to be reached through government interference 
in behalf of labor. 

The favor with which the proposition for the government 
purchase of the coal mines was received is another straw 
showing which way the tide is setting, even in the conser- 
vative old commonwealth of Great Britain. But clearer 
yet, and more to the point, are the recent remarks of the 
Tribune Association in London. (See New York Tribune, 
January 7, 1894, as follows :) 

*' London, Jan. 6. — The tremendous set of politics toward labor 
is again visible this week. It may equally well be called the sub- 
ordination of political to social questions. Mr. Fowler's bill for 
the reorganization of local government throughout England is a 
distinct and avowed effort to put power into the hands of the labor, 
ing classes not political only or mainly, but social, economical, fis- 
cal, and much else. The compulsory power of taking land for al- 
lotments is an example of the spirit in which the rights of property 
are dealt with. It is not the spirit of confiscation, for compensa- 
tion must be paid at the market price, but it is the new spirit of 
State Socialism, not yet openly avowed as a principle, but acted 
on in details." 

If these Englishmen who have been acting State Social- 
ism in details, as the Tribune Association expresses it, were 
obliged to answer yes or no to the question " Are you 

66 



THE LABORER AND THE CAPITALIST. 

Socialists?" a large majority would answer, "No," and 
the answer would be correct. They are not Socialists as 
they understand it. Indeed, most of them have not con- 
sidered what relation their conduct has to Socialism ; they 
have not studied the theory of Socialism. Nevertheless, 
they have come to favor a more paternal social and economic 
system, the present government to the contrary notwith- 
standing. What is this but the beginning of Socialism ? 

In the United States we observe the same tendency to- 
ward a more paternal government and a new social system. 

I had thought of dealing at considerable length with 
statistics and other arguments, to show how rapidly the be- 
lief is growing in the United States that, as the Methodist 
Conference expressed it, " the present inequality in the 
ownership of property is a frightful evil," and that the gov- 
ernment ought to somehow interfere to prevent it. But 
considerable has been said upon that point in the opening 
chapters, and I now feel that there is no necessity for an 
extended effort to demonstrate a proposition so palpably 
true. I will, therefore, quote a very few opinions, and let 
them suffice. A statement by Judge Brewer, of the United 
States Supreme Court, is to the point. (See Fourth of July 
oration cited in a previous chapter.) The Judge said : 
"Through the land the idea is growing that the individual is 
nothing, and that the organization, and then the State, are every- 
thing/' 

This opinion is valuable, not only as coming from a man 
of learning and sound judgment occupying a position not 
affected by either capital or labor, but as the statement of 

67 



THE LABORER AND THE CAPITALIST. 

one who is a careful observer of events and a ripe student 
of the times. 

On page 142 of Dr. Strong's work, before quoted, I 
find as follows : 

"As to the number of Socialists in the United States we have no 
exact knowledge. Their press is numerous and is increasing. 
They now have ^ nineteen journals, whose combined circulation is 
about 80,000. These papers are wholly devoted to the propaga- 
tion of Socialism, and there are many others which are more or 
less socialistically inclined." 

On page 144 Dr. Strong says : 

"At the last election (1890) in Berlin the Socialists cast 126,. 
522 votes, over 20,000 more than all other parties. Professor 
Fawcett, in opening his present course of lectures at Oxford 
(1880), said that, if the growth of the Socialistic poHtical vote 
progressed in Germany and the United States for the next fifty 
years as it had for the last fifty, capital can do nothing effective 
against Socialism. '^ 

Note the following from so conservative a divine as Dr. 
McArthur, of New York. See New Nation, December 10, 
1892, as follows : 

"It does not take a prophet or the son of a prophet to predict a 
revolution inside of the next twenty-five years which will modify 
the whole social fabric. Editors, professors, philanthropists, and 
many blatant demagogues are now crying for State Socialism — for 
the control by the people of the railroads, telegraphs, and the like." 

The following is copied from the New York morning 
Press, July 19, 1894: 

68 



THE LABORER AND THE CAPITALIST. 
HERBERT SPENCER SAYS WAR. 

** Herbert Spencer has written the following letter to James A. 
Skilton, General Secretary of the World's Congress of Evolution- 
ists:'' 

'*Dear Mr. Skilton: In the United States, as here and else- 
where, the movement toward dissolution of existing social forms, 
and reorganization on a Socialistic basis, I believe to be irresisti- 
ble. We have bad times before us, and you have still more dread- 
ful times before you — civil war, immense bloodshed, and eventually 
military despotism of the severest type. Yours truly," 

'^Herbert Spencer." 

I do not expect the bloody war and military despotism 
predicted by the great English scientist ; but that there is a 
growing tendency toward the dissolution of existing social 
forms, to reorganize on a more Socialistic basis, is true be- 
yond all question. 



CHAPTER IX. 

ARGUMENTS OF SOCIALISM. 

I£ we assume that the Socialistic sentiment is growing 
faster than any other political theory, faster than the voting 
population, the question as to what the arguments of Social- 
ism are becomes very important. 

As I cast my mind over the subject with a view to an- 
swering this question, I am reminded of a certain rule of 
conduct adhered to by Abraham Lincoln which is very ap- 
plicable to the present case. 

69 



THE LABORER AND THE CAPITALIST. 

Into whatever debate he entered he never understated 
the cause or the arguments of the opposing party. The 
more important the question at issue, the more pains he took 
to state the opposite side clearly. In the practice of the 
legal profession it not infrequently happened that he placed 
the law and evidence, which had been supposed to contra- 
dict his theory of the case, before the court and jury in a 
stronger light against himself than even his adversaries had 
thought of or were capable of doing. This course was not 
only generous toward others, but it was a winning card for 
himself, for the reason that when he came to state the still 
stronger logic of his own side, the justice of his cause was 
all the more clearly seen. 

If ever there was a time when all the arguments on both 
sides of a great question needed to be clearly stated and 
carefully considered, that time is now, in the present con- 
troversy between conservative capital and the rapidly grow- 
ino^ sentiment of Socialism. 

Socialism, like all other isms, good and bad, has three 
sets of argi'uments. One has to do with the fundamentals 
and the beauties of its own theory ; another with the er- 
rors and inconsistencies of such other theories as it wishes 
to break down ; and the third consists largely of generali- 
ties, the glorious prospects of its own future, and the awful 
doom awaiting those who from neglect to study or from 
other causes are blind to the situation. 

The latter set of arguments are not necessarily fallacious, 
neither are they always the least effective, especially after 
a movement is known to be making headway. 

70 



THE LABORER AND THE CAPITALIST. 

The Coming Nation, a labor paper published in Indiana, 
September 30, 1893, has an argument of this character, 
which it is well to notice briefly before taking up the more 
fundamental and intricate. I copy as follows : 

"When any widespread dissatisfaction exists against any sys- 
tem that system is doomed. Years ago a few thinkers, by mental 
analysis, convinced themselves of the wrongs of chattel slavery. 
Slavery had existed from immemorial time, but that did not deter 
these men from denouncing it and showing its fundamental injus- 
tice. Chattel slavery is no more with us. For years a sentiment 
has been growing stronger and stronger each year against the sys- 
tem of wage slavery, which, in its finality, is worse than chattel 
slavery, for it has less of sympathy and care for the workers. 
The fact that you, my old-party brother, have not been noticing 
this ferment or inquired into its economics does not alter the fact 
that the sentiment is here and widespread — world-wide, in fact. 
In the antislavery agitation but comparatively few understood 
the situation or the forces behind it. It was this fact that plunged 
the country into a bloody revolution, while ignorance and preju- 
dice of the masses on both sides became a prey to the ambition of 
ignorant leaders until wise and unwise were thrown into the vor. 
tex, and reason could not assume control until the fire of passion 
had exhausted itself in carnage. With this severe lesson fresh 
in the mind, how can you be so blind as to repeat the folly ? Why 
will you not study up the economics of so important a question 
— one holding in its solution not only the wealth of the nation, 
but the lives of its citizens ? If this growing sentiment is wrong, 
that can be easily demonstrated by convincing logic, and, having a 
great majority of the press, you will have no difficulty in holding 
the people out of it or weaning them back. But you cannot ex- 

n 



THE LABORER AND THE CAPITALIST. 

plain to the reformers they are wrong except by reading the books 
they have read and pointing out the errors. Otherwise your ar- 
guments will not touch the mind where it has been influenced. 
You cannot combat it without reading it. If on reading it you 
find it is truth and justice, of course it wiU be to your interest to 
go with it. But let me impress you with one thing that is be- 
yond all doubt or cavil — the movement is here^ and will as cer- 
tainly sweep this country as the sun shines unless you do read up 
and show its fallacies. Assertions are not arguments, and will 
have no force. You must analyze and demonstrate in clean, 
clear, logical, truthful statements its fallacies. Failing to do 
this it is not many years when your "peculiar institution" of 
wage slavery, with its poverty, crime, and woe, wiU be classed 
among the ' has beens,' and a new era, radiant with joy, peace, 
plenty, and love, will be ushered into existence, bringing in that 
for which Christ prayed, " in earth as it is in heaven." 
*'Come, help us if we are right, or lead us to the right." 

While this article may be said to consist of generalities 
and unverified assertions, like many of the quotations in 
the early part of this volume, yet it represents a widespread 
sentiment, and the italicized words are especially worthy of 
thought. 

The failure to discuss the fundamental theories of a 
rapidly growing political economy, and the ignoring of 
those who ask for State Socialism, except to call them 
cranks, mugwumps, etc., are made a telling argument 
among the masses against the position of capital, and the 
course pursued by some leading journals which popular re- 
formers are denouncing as the subsidized, capitalistic press 
of the country. 

72 



THE LABORER AND THE CAPITALIST. 

The statement in the quotation that assertions prove 
nothing is correct ; and if the arguments now being put 
forth against the present regime are sound, and the philos- 
ophy of the wage system cannot be sustained by clear, 
truthful argument, all honest people will want to help de- 
stroy it as soon as something better can be found to take 
its place, whether that something be Socialism or what not. 

SociaHsts are proud and happy in the belief that they are 
building upon a rock, and that their arguments are first 
principles. 

Now let us imagine that we have a Socialist before us 
ready to explain to the capitalist in every-day phraseology 
his theory of reform, his platform of principles, and his 
opinion of the situation ; in short, to plead his own cause 
as he sees fit, or as SociaHsts do plead their cause in their 
talks to the public and with their neighbors. We will have 
the capitalist address him as follows : 

" Mr. SociaHst, I wish to call your attention to a state- 
ment by Judge Brewer, of the United States Supreme Court 
(see Fourth of July oration before quoted). Referring to 
the Populists he said : 

'*I know that the great body of these people are moved only by 
a conviction of the injustice of present law and social conditions, 
and are striving to compel a more equal distribution of the good 
things of earth. 

*'With sympathy for the purpose which actuates them, I am con- 
vinced that their ignoring of the lessons of history is a step to- 
ward Socialism and the destruction of the liberty that the toil of 
centuries haa achieved. " 

73 



THE LABORER AND THE CAPITALIST. 

" You will observe, Mr. Socialist, that the distinguished 
Judge regards the PopuHsts as honest, but believes they 
have taken a step toward Socialism, which he thinks is 
dangerous to Hberty. What have you to say of the matter? 

Socialist, answering : 

" As I see it, Mr. Capitalist, the masses are heading toward 
Socialism, but most of them are not aware of it. They are 
trying to secure a more equal distribution of the good 
things of earth, as Judge Brewer has remarked, and the 
opinion is more or less prevalent in all parties that monop- 
oly and plutocracy are giants blocking the pathway that 
leads to that glorious result. 

" The platforms of other parties declare as strongly as ours 
against the centralization of power, resulting from large 
aggregations of wealth. The difference in opinion as to 
the best means for accomphshing the same end is the divid- 
ing Hue between the Socialist party and all other parties. 
As a rule, the Populist is nearer to the Socialist camp, so to 
speak, than are the adherents of the older parties ; that 
is, he has made more progress toward the larger idea, which 
is to govern the world sooner or later, and I belie v^e much 
sooner than most people dream, — I mean the idea of a co- 
operative commonwealth. 

'' But while the Populist has taken a long stride in the 
right direction, yet he is illogical in that he has not re- 
nounced the private ownership of property, which is the 
fundamental cause of more than 90 per cent, of all the 
wrongs we complain of. This the Populist will see sooner 
or later. The small monopoly is the beginning of the 

74 



THE LABORER AND THE CAPITALIST. 

larger. Tolerate tlie infant, and full-grown men, even 
giants, will appear. Tolerate the private ownership of 
property, which means individual fortunes, and huge mon- 
opolies will flow from them, as naturally as rivers will gather 
force from springs and small streams. 

" If you would put an end to large monopolies, you must 
prevent the smaller from coming into existence. We Social- 
ists regard the old maxim that an ounce of prevention is 
worth a pound of cure, and we see no sense in propping a 
superstructure which, owing to a wrong foundation, is des- 
tined to fall sooner or later and carry the props down 
with it. 

"As a Socialist, replying to Judge Brewer's assertion that 
a step toward Socialism is a step toward the destruction of 
liberty, I will call attention to an editorial which appeared 
in the New York Times, August 12, 1877, as follows : 
" *Is there deliverance? There seems to be but one remedy, and 
it must come — a change of ownership of the soil and a creation of 
a class of landowners on the one hand and of tenant farmers on 
the other — something similar in both cases to that which has long 
existed, and now exists, in the older countries of Europe. . . . 
Everything seems ripe for the change ; half the farms in the coun- 
try are ready to be sold, if buyers would only appear, and hundreds 
that can now be bought for less than their value of twenty or 
thirty years ago. 

'Few farmers can hope to provide their sons with farms of their 
own, and there is no place for these young men in the overcrowded 
cities. Those farmers who are land-poor must sell and become 
tenants, in place of owners, of the soil. The hoarded, idle capital 
must be invested in these lands, etc' " 

75 



THE LABORER AND THE CAPITALIST. 

*' Now, Mr. Capitalist, you cannot be ignorant of the fact 
that the sure road to the destruction of liberty is through 
the impoverishment of the many, so that they become de- 
pendent upon the few for the means of subsistence. You 
are also aware that while the farmers were being reduced 
to where they were ready to sell their homes for less than 
their value twenty years before, wealth had been accumulat- 
ing in the hands of the few, who, according to the New 
York Times, were abundantly able to purchase the farmer's 
home. In other words, while the hope of the farmer's son 
to own a farm of his own was being blasted, and his father 
reduced to the condition of a tenant, at the mercy of a land- 
lord, capital had grown correspondingly independent and 
powerful. 

" When Judge Brewer shows that Socialism can exceed 
this twenty-years movement toward the destruction of lib- 
erty by our present economic system he may consistently 
charge us with despotic tendencies, but not till then. 

" But, Mr. Capitalist, I have another statement from a 
leading New York daily, to which I ask your attention. 

"It appeared in the New York World, January 11, 
1877, as f oUows : 

''The changes which have been wrought in this country since 
1860 have all tended to equalize the conditions of life as between 
Europe and America, and these conditions have approached each 
other more nearly than Americans twenty years ago ever expected 
to see them do, and much more nearly than the vast majority of 
Americans are yet aware. The American laborer must make up 
his mind henceforth not to be so much better off than the European 

76 



THE LABORER AND THE CAPITALIST. 

laborer as his father was, and that it wiU be harder for him than 
it was for his father to cease to be a laborer and become an em- 
ployer of labor. A man hereafter will have more of a struggle in 
this country to escape from the place in which he was bom." 

"We Socialists have been accused of saying many un- 
pleasant and discouraging things to the laboring people, 
but what Socialist has ever drawn a more disheartening pic- 
ture, or prophesied a darker doom for the wealth-creators 
of our country, than the last-quoted journals have done, 
one at that time supporting the Republican, the other the 
Democratic, party, and neither of them supposed to be 
especially interested in labor ? 

" I question, Mr. Capitalist, whether theTimes or the Wo7'Id 
would think it wise to make the same statement at the pres- 
ent time, though they believe it never so strongly. The 
social and industrial world is very much more disturbed 
and very much more in earnest than it was seventeen years 
ago, when these opinions were published. 

" However, Mr. Capitalist, I have two or three statements 
of recent date from important sources, which I wish to 
submit to your further consideration. 

" During the recent tariff discussion in Congress one of the 
distinguished leaders of the Republican party, Thomas B. 
Reed, February 2, 1894, said : 

*' Whether the universal sentiment in favor of protection as ap- 
plied to every country is sound or not I do not stop to discuss. 
Whether it is best for the United States of America alone con- 
cerns me now, and the first thing I have to say is that after thirty 
years of protection, undisturbed by any menace of free trade, up 

77 



THE LABORER AND THE CAPITALIST. 

to the very year now last past, this country was the greatest and 
most flourishing nation on the face of the earth." 

'' Mr. Wilson (the father of the Wilson bill) replied to 
Mr. Reed's argument as follows : 

' You can't prevent the accumulation of wealth in this country, 
but you can take wealth from men who make it and bestow it upon 
others who have not earned it. In a speech on March 10, 1860, 
Daniel Webster said that five-sixths of the property of the North 
belonged to workingmen of the North. Can any Representative 
from the Commonwealth of Massachusetts make such a glorious 
boast to-day? There is a statement in the last census report of 
the United States that calls on every citizen to pause and ponder 
as to whether it is a sign of growing prosperity or a sign of grow- 
ing and dangerous decadence. It appears in that report that of 
all the men occupying farms in this country to-day one-third of 
them are tenants living on farms of others. It appears that of 
all people occupying homes other than farms two-thirds live in 
rented houses. If that is a sign of general prosperity, then the 
protective system is entitled to the credit of it, because that it is 
in a large measure due to that system.' 

" You will take notice, Mr. Capitalist, that Mr. Reed attrib- 
utes the marvelous growth of the country in the last thirty 
years to a high tariff. Mr. Wilson admits the increase of 
wealth claimed by Mr. Reed, but infers that that wealth 
has lodged in the hands of a few, since the census reports 
show that a larger and larger percentage of the farmers of 
the country are becoming tenants, working land not their 
own, while the percentage of the whole population owning 
homes is growing smaller and smaller. 

78 



THE LABORER AND THE CAPITALIST. 

" Or, to state tlie substance of the arguments of tliese gen- 
tlemen in another way, Reed says : ' See how wonderfully 
the wealth of the country has been increasing under a high 
tariff.' Wilson says : ' This is true of the few, but behold 
how rapidly the many are becoming dependent and homeless.' 

"We Socialists look upon the arguments of both of these 
men as failures, since neither proves that his system of tarifp 
ever has, or ever can, secure a just distribution of the results 
of toil. The inequality in the ownership of property is as 
great in free trade as in protected countries ; wealth cen- 
trahzes as rapidly under a low as under a high tariff. The 
tariff question undoubtedly affects the business of the coun- 
try at the present time. It is an important incident in the 
march of greater events. 

"But the thought and theory that stirs philanthropy, 
makes our Socialistic party grow so rapidly, and shakes the 
foundation of old ideas regarding the natural relationship of 
State and people are embodied in a statement by the newly 
elected Master Workman of the Knights of Labor. (See 
Missouri World, January 24, as follows) : 

' A republic that will deliberately squeeze the manhood out of 
200,000 tramps to make a Vanderbilt, a Gould, or an Astor, and 
abrogate the birthrights of millions of God's deserving children 
that a few may hold titles to a million homes which they cannot 
occupy and aid the private monopoly of natural bounties and the 
great agencies of distribution, is a disgrace to the name it bears 
and the flag it floats. 

' In this repuhhc the wild brutes, birds, and fishes live and en- 
joy life without labor ; yet civilized and intelligent man labors 

79 



THE LABORER AND THE CAPITALIST. 

and starves. But worse still is the fact that one man produces 
much and enjoys little, and another produces little and enjoys 
much.' 

" I am content, Mr. Capitalist, to offer no comment on this 
statement of the Master Workman of the Knights of Labor, 
further than to say that what he complains of is the neces- 
sary and logical result of the working of the economic sys- 
tem under which the people groan and have groaned for 
centuries ; and the present ferment in the social and indus- 
trial world is the instinct of self-preservation becoming cul- 
tivated and intensified by education. 

" These, Mr. Capitalist, are our every-day arguments clothed 
in every-day phraseology, and the fact that we can sustain 
our attacks upon the present economic system with an abun- 
dance of testimony from authorities not supposed to have 
the least sympathy with Socialism adds greatly to our suc- 
cess in proselyting. Nevertheless, I am not willing to take 
my leave of the subject, Mr. Capitalist, until I have offered 
a brief extract from our more condensed and better pre- 
pared argument on the subject of the private ownership of 
property. Find in the Republic (previously quoted), October 
14, 1893, as follows : 

* Property is the throne on which Mammon now sits ruling the 
world. 

' The ideal relation of property to man is that of servant to mas- 
ter. As long as Mammon remains enthroned and goads his illu- 
sioned with the fear of want and the hope of idleness, property will 
not become the servant of humanity. 

* The solid basis of Mammon's logic is that the want which is 

.80 



THE LABORER AND THE CAPITALIST. 

feared can only come through others making a profit greater or 
less from the labor of him who possesses the fear, and that the 
hope of idleness is only to be realized through making a profit 
from the labor of others. These two things are only too true. 
But examine the point around which they revolve — think while 
on the relation of profit to the slavery which Mammon imposes 
from his throne of property. If profit were removed from the 
problem — if you could hope for no unhealthy idleness from others' 
labor, and fear no want from others' profit on your labor, and the 
same were true of them — what becomes of Mammon's throne? Is 
it not demolished, and does not property, freed from Mammon's 
incubus, become at once the servant ? 

' Here, then, is the avenue of progress : Property, as well as 
commerce and industry, must be administered, not for profit, but in 
terms of brotherhood through the co-operative commonwealth.^ 

" We Socialists regard this position as ethical and impreg- 
nable ; but we do not for this reason regard all other polit- 
ical issues as unimportant ; for example : 

" We Socialists vote more or less with other parties as a 
temporary expedient; but we are grounded in the faith 
that nothing short of government control of the forces o£ 
production and distribution can prevent the shrewder and 
more unscrupulous from absorbing the earnings of the 
many and monopolizing most of the good things of earth, 
which is constantly taking place, and must ever take place 
under a competitive system of government. 

" And this, Mr. Capitalist, is all I would say for the present 
in defense of Socialism. " 

Within the last quarter of a century these arguments of 
the Socialists have impressed in no small degree the pulpit 

81 



THE LABORER AND THE CAPITALIST. 

of Christendom. They have their adlierents in every civil- 
ized legislative body on the globe. They have attracted 
and are now occupying more of the attention of men of 
learning, of conscientious thinkers, of earnest philanthro- 
pists, to say nothing of the shifting multitude, than any 
other political argument or set of arguments have done 
before, and I have the satisfaction of feeling that I have 
endeavored to state these arguments as frankly and as 
clearly, in the present chapter, as I hope to state my own 
arguments against them in the chapters that are to follow. 



CHAPTER X. 

THE DIVISION BETWEEN MAN AND MAN. 

The following is copied from the New York Herald: 

'*New Haven, Conn., Feb 24, 1891. — Much comment has been 
aroused by the remarks of the Rev. Dr. W. W. McLane, pastor 
of the College Street Congregational Church, at the Washington 
birthday celebration yesterday. 

' The time will come,' he said, ' under a democratic form of 
government, when the wealth of the country will not be gathered 
in the hands of a few, when every man will have an honest and 
just portion of the goods he produces.' 

''Here some of his auditors applauded and others hissed." 

'If there is a millionaire out there hissing,' exclaimed the 
speaker with great warmth, 'let him hiss. I say this not to win 
applause, but because it is God's truth. Millions of men have 
been ground down by kings and millionaires, but the spirit of 

82 



THE LABORER AND THE CAPITALIST. 

honest patriotism will not stand it forever, and that spirit will 
progress until the sources of wealth are held by the government. 
Hiss if you will, but it will surely come, not by revolution, I hope, 
but come it will in some manner, for it must.' 

However widely I may differ from Dr. McLane in opin- 
ion, I can but respect his manhood. He believes that the 
present system of exchange does not award to each man a 
just portion of the goods he produces, and I infer from his 
words that he has embraced the popular theory that the one 
great hindrance to a more equitable distribution of goods 
produced is the millionaire (rich man). This, being his 
conviction he has the courage to say so, even to an aristo- 
cratic church audience in aristocratic New Haven; and 
more than that, he suggests a remedy which necessarily in- 
volves the destruction of the economic methods which have 
resulted in the accumulation of the very money that now 
supports him in his pulpit. One sermon or lecture from 
such a man will influence the public mind more than a 
hundred speeches from the average politician. But all this 
does not make his theory sound. 

He would have the sources of wealth pass under the con- 
trol of government, to the end that the few may not be- 
come rich in goods which the many have produced. 

To establish his position. Dr. McLane must first demon- 
strate that the few do become rich in the goods so pro- 
duced without a corresponding benefit accruing to the many 
as a result ; and also must he demonstrate that government 
control of the sources of wealth will result in a more nat- 
ural and righteous exchange between man and man, and 

83 



THE LABORER AND THE CAPITALIST. 

therefore contribute more to human progress and happiness 
than the present system. 

This he does not undertake to do. He assumes — but 
then everybody once assumed that our earth was flat, but 
that did not make it so. Proof is wanted in this case, as 
in many others where assumption is allowed to stand as the 
basis of popular movements. 

Let us try to investigate this deep and momentous sub- 
ject without reference to what may or may not have been 
previously said or assumed regarding it. Let us go down 
to first principles as nearly as possible. We will begin with 
the universally accepted proposition that no two human be- 
ings are constituted exactly ahke. It therefore follows that 
no two can always think exactly the same thoughts, nor are 
they affected exactly the same by environment. We can- 
not all occupy the same spot of earth at the same time, nor 
strike the same vein of success. Some are born in the 
centers of education and refinement, others amid ignorance 
and barbarism; some are rugged, others are frail. In 
short, our mental capacities are not equal, our physical 
strength is not equal, and our opportunities are not equal. 
Some must be wiser than others, some richer, and some 
both wiser and richer, etc. 

This is in perfect accord with natural law. The differ- 
ence in the results we behold are based upon the difference 
in constitutions. To change this basic principle, or the re- 
sults that flow from it, would destroy human happiness, 
since we know and appreciate only through differences (con- 
trast). If all were as tall as the tallest there would be no 

84 



THE LABORER AND THE CAPITALIST. 

tall people ; if all were as short as the shortest there would 
be no short people ; if all were as wise as the wisest there 
would be no wise people ; if all were as happy as the hap- 
piest there would be no happy people. If there were no 
difference in color we would know no color ; if there were 
none of that which we call evil we could not appreciate the 
good ; in fact, without evil it woidd be impossible to give 
good a name that could be understood. Therefore, if dif- 
ferences were stricken out, greatness, goodness, variety, 
indeed all that we admire, appreciate, and love, would be 
gone, and a monotony woidd reign a million times more 
cruel to beings constituted as we are than any differences 
we have ever known in the conditions of life that now 
environ us. 

Of course, extremes exist everywhere and in everything. 
Some are richer, for example, than there is any need of, 
and there is more severe poverty than ought to be. 

However, the ambition of human Hfe is to move onward 
and upward — to achieve, to conquer. It is the fiat of In- 
finite Wisdom that it shall be so. We now propose to show 
that it is also the fiat of Infinite Wisdom that, as a rule, 
the greater success of one shaU mean the greater success of 
aU. 

To illustrate : Some are a thousand times more success- 
ful in gaining that priceless thing we call knowledge than 
others. But after they have gained it, even their most 
selfish motives compel them to distribute it. 

If we would have others further our ends and gratify 
our desires, if we have gained new ideas which, spread 

85 



THE LABORER AND THE CAPITALIST. 

abroad, will advance our own interests and gratify our own 
ambition, we must make others see and understand as we 
see and understand. To accomplish this our knowledge 
touching the matter in question must be demonstrated. 
When this is done, others possess the knowledge as well 
as ourselves. Therefore the community as a whole receive 
a benefit corresponding to that which we receive as indi- 
viduals. 

It is a self-evident proposition that, as a rule, those who 
become wise increase the opportunities of others to become 
wise also. 

Here methinks I hear it said : '^ 0, if the same beneficent 
law only governed the getting and using of wealth that 
governs the getting and using of knowledge, what a happy 
world this would be ! If Infinite Wisdom had so ordained 
that while we were accumulating wealth for ourselves we 
were necessarily making it easier for others to accumulate, 
and the more we succeed in accumulating the more the 
world gained in consequence, peace and contentment would 
reign in every land." "But," you say, "such is not the 
case. Those in pursuit of wealth are so selfish ! Their 
zeal leads to oppression, and their increasing hoards are ac- 
cumulating proofs that labor is being robbed of its hard 
earnings." 

Is there not some mistake in the popular understanding 
of this matter? Is it true that those who are successful in 
the pursuit of wealth are selfish above all others? And 
can it be truthfully said that the efforts of the successful 
financier are not as helpful to the financial world as are 

86 



THE LABORER AND THE CAPITALIST. 

the efforts of the scholar to the world of science and let- 
ters? 

Let us see. Many noble souls have been glad to gather 
and use both wealth and knowledge solely for the good of 
humanity. Many are doing so at the present time. But 
they are few when compared to those who prefer to gather 
and use for other purposes. As a rule one's own comfort, 
his own power among men, his own distinction before the 
world, in short, self-aggrandizement, is the common main- 
spring to both learning and wealth, and one is as selfishly 
acquired and as selfishly manipulated as the other. 

Those who have the good fortune to possess learning 
above the average are no more wilhng to use it for the ben- 
efit of others without a consideration than are the possessors 
of material wealth wilhng to use their hoards for the benefit 
of others without some sort of remuneration. 

The miner in the earth finds a nugget of gold of more 
value than the average earnings of a lifetime. He de- 
mands the highest market price before he is willing to allow 
others the full right to use it. 

The inventor, or the delver in the mines of science and 
philosophy, may suddenly grasp a new principle, or, rather, 
an old principle, but which to the world is new. He calcu- 
lates the value of his discovery, gets it patented or copy- 
righted, and then offers it in market, precisely as the gold 
miner offers his product. 

Now, if those whose talent and good luck have enabled 
them to gather sufficient knowledge to give them promi- 
nence in the world of science and letters are public benef ac- 

87 



THE LABORER AND THE CAPITALIST. 

tors, whether they will or no, why should not those whose 
financial ability and good luck have led to distinction in the 
world of trade and commerce be pubHc benefactors, whether 
they are charitably disposed or not? 

Or, to put the question in another way, if it is ordained 
that in the gathering and using of knowledge we are com- 
pelled to benefit others in order to reap a benefit for our- 
selves, is it not reasonable that the same law should govern 
the getting and using of wealth ? 

We may rest assured that Infinite Wisdom has not en- 
dowed one with talent above another, and then left him 
free to use it exclusively for his own aggrandizement, and 
his fellow-mortals reap no benefit therefrom, whether the 
talent be in the direction of finance or of philosophy. 

To the end that financial talent shall redound to the pub- 
lic good, nature has ordained that we shall buy of and sell 
to others, precisely as others buy of and sell to us ; so that 
in the long run the benefits arising from the exchange are 
shared by all. This fundamental and almost universally 
overlooked truth may be illustrated as follows : 

Jones is a shoe manufacturer; you are the people. Jones 
manufactures shoes ; you (the people) purchase them of him 
at market price and pay the money. 

Now, what will Jones do with the money? He can 
neither eat, drink, nor wear it. He must turn around and 
pay every cent back to you (the people) for the products of 
your labor. He must pay you the market price, mark you, 
as you have paid him the market price. 

Now, Jones has bought of you (the people) precisely as 

88 



THE LABORER AND THE CAPITALIST. 

much as you have bought of him (the manufacturer) ; and, 
both having made your exchanges according to prices rul- 
ing in the general market, it necessarily follows that you 
(the people) have gained as much as Jones (the manufac- 
turer). 

This is the result of an infinite and irrevocable law of 
exchange and mutual dependence which unites all interests 
in one and strikes a just balance between capital and labor, 
between capital and capital. 

On one occasion a distinguished lawyer, now in the em- 
ploy of one of the largest corporations in the world, op- 
posed my theory regarding the effect of the law of exchange 
and mutual dependence, and in doing so he used substan- 
tially this language : 

" Mr. Willey, money is only a medium of exchange, and 
the trade of the world is simply the people swapping goods 
with one another. Now, if when we trade we give value 
equal to that which we receive, where does the profit come 
in, and how does one man become so much richer than an- 
other?" 

The fact that under the law of exchange we give value 
equal to that which we receive, does not prevent us in the 
least from making a profit on what we sell, nor does it hin- 
der one from becoming richer than another. 

Farmer H. takes one hundred bushels of wheat to mar- 
ket, and sells it for one hundred dollars (one dollar per 
bushel). But it cost him only ninety cents per bushel to 
produce it. His profit is, therefore, ten dollars on the 
hundred bushels. He wants to buy a horse. Farmer G. 

89 



THE LABORER AND THE CAPITALIST. 

has one to sell; the price is one hundred dollars, but the 
cost of raising has been only ninety dollars. However, 
Farmer H. purchases the horse for one hundred dollars, 
which is the market price for that grade of animals. Far- 
mer G. takes the hundred dollars which he has received for 
his horse and invests it in lumber. 

Now, Farmer H. has practically swapped his wheat for a 
horse, and Farmer G. has swapped his horse for lumber, 
Both have paid the market price for what they have bought, 
and received the market price for w^hat they have sold, and 
each made a gain of ten dollars. 

Or, to state the same truth in another way, both men 
have given value equal to that which they received, and 
gained in wealth ail the same. 

But, you may say, we have shown how each of the two 
farmers gained ten dollars by giving and receiving equal 
value, but have not shown how one man can become vastly 
richer than another by the same method of exchange, or by 
continuing the same practice with all people and on all oc- 
casions. 

Let us see. If we produced exactly the same quantity 
of goods as yourself and had exactly the same quantity to 
sell, and yours were exactly what we wanted and ours were 
exactly what you wanted, with the cost of production and 
expense of living the same in both cases, and we exchanged 
with each other exclusively, it would be impossible for one 
to accumulate more wealth than the other. But no such 
condition exists, nor will it ever exist. 

Money is a medium of exehanp^e, and trade is the people 

90 



THE LABORER AND THE CAPITALIST. 

swapping goods, as our legal friend has stated ; but no two 
men produce the same quantity of goods ; neither do they 
consume the same quantity of vv'hat they do produce. There- 
fore no two have the same quantity to spare or to give in 
exchange for what the other has to sell. 

It may have been the good fortune of one farmer, for 
example, to have hit upon soil vastly more productive than 
his neighbor's soil five miles away. He will therefore have 
a great deal more of value for the market — two horses, say, 
to his neighbor's one. This will give him two dollars' gain 
for every one his neighbor can reahze. This difference in- 
vested and compounded annually for twenty-five years is 
liable to make the property of one worth many times that of 
the other at the end of the period. This is presuming that 
both men are equal in industry and financial talent. 

Now, when we consider the difference that exists in talent 
and industry, as well as in locaHty, or luck, whichever you 
please to call it, it is not hard to account for the difference 
in the wealth of individuals upon the basis of each giving 
value equal to that which he receives. 

Of course, we do not claim that no one man ever got rich 
at the expense of another. Such a thing has often taken 
place. In the stock exchange, for example, many risk all 
they have and lose it, while occasionally a large fortune is 
won without rendering an equivalent. 

Again, through technicalities in law, through misrepre- 
sentation, in fact in a great many ways, one will get posses- 
sion of property that rightfully belongs to others. 

If we meet a stranger with a hundred thousand dollars, 

91 



THE LABORER AND THE CAPITALIST. 

we do not know that he got it honestly. If we meet a 
stranger with only one dollar, we are not sure that it right- 
fully belongs to him. 

But my proposition is that, whether people try to ac- 
cumulate by honest methods or not, the law of exchange 
and mutual dependence holds them so firmly to the Infinite 
plan of equal reward for equal effort, that a suf&cient num- 
ber cannot break from it to materially affect the fortunes 
of the rest. 

If one man becomes vastly richer than another, he must, 
as a rule, do vastly more business, which, of course, employs 
vastly more labor. No man can become very rich in busi- 
ness using nothing but his own hands. He must employ 
others ; and the more hands he employs, the more he pays to 
labor, and the more labor has with which to purchase goods, 
and, of course, more trade and more general prosperity are 
the result. 

There is not a case in a thousand in which men of great 
wealth have not been exceptionally beneficial to the commu- 
nity, whether they have been charitably disposed or not. 
How can it be otherwise ? 

When we see a rich clothier, for example, his wealth does 
not consist in money, bat in commodities purchased from 
the people — houses, lands, animals, clothing, etc., etc. This 
has given others the opportunity to sell all these things. 

The reciprocity in the case is this : When the clothier 
has sold a million dollars' worth of his own product to 
the people, he pays the million dollars to the people again 
for their product which is the product of labor. Thus, the 

92 



THE LABORER AND THE CAPITALIST. 

more wealth he has gained, the more labor he has employed, 
and the more he has bought of the people's products. 
Therefore, his increasing hoard is not accumulating proof 
that he is robbing the community, but that he is employing 
the labor and increasing the trade thereof. The people are 
paying him the market price for his goods ; he is "psijing 
them the market price for theirs. He must, therefore, in- 
crease the wealth of the people as a whole, according as he 
increases his own as an individual. 

This is the law of exchange and mutual dependence. 
This law made it impossible for Yanderbilt to gain $100,- 
000,000 without benefiting the world at least another $100,- 
000,000. He was forced to buy as much of the people as they 
bought of him. He was compelled to increase the trade 
of others precisely as much as he increased his own. He 
could not purchase of himself ; he could not sell to him- 
self ; the people were his customers and he was theirs. So 
far as Vanderbilt's energy, financial ability, and material 
success were above the average, so far was he bound to in- 
crease the business of the world above the average. 

It was better for the people to have Cornelius Vanderbilt 
at the head of a great transportation enterprise than a 
thousand others of only average caliber. In fact, he ac- 
compUshed the very things for himself and the country 
that other capitaHsts would have liked to accomplish, but 
who lacked, not the money, but the sagacity and energy. 

Mr. Vanderbilt cheapened transportation greatly and 
brought the market much nearer to the people. Whether 
he did this of his own free will or through fear of compe- 

93 



THE LABORER AND THE CAPITALIST. 

tition or from a desire to monopolize more of the carrying 
trade, is not material to this discussion ; suffice it to say he 
was a powerful factor in the reduction of the cost of trans- 
portation while he lived. 

Then, too, every dollar that he had in his possession 
from the first to the last day of his career went to buy the 
products of other people's labor. Everything his own 
hands produced, and everything his brain stimulated the 
hands of others to produce, was so much added to the 
world's wealth. As a rule he was able to retain only such 
share of profit as others retained who exchanged the prod- 
ucts of their hands and brains for the products of his. 

Therefore, if 1 100,000,000 lodged in the hands of Van- 
derbilt another $100,000,000 necessarily lodged in the 
hands of the people as a consequence. 

Therefore the Vanderbilt fortune does not stand for goods 
or value wrung from the community without compensation, 
but it represents services rendered, with an advantage to 
the people fully equal to the price they paid. 



CHAPTER XI. 

THE DIVISION BETWEEN CAPITAL AND LABOR. 

In the preceding chapter I have discussed the law of ex- 
change and mutual dependence, more especially as it affects 
people in trade or those swapping goods. Of course, the 
law that governs in those cases reaches the wage-earner as 

94 



THE LABORER AND THE CAPITALIST. 

well, and what has been said concerning one applies with 
equal force to the other. Nevertheless, I will devote a 
chapter to the consideration of the relation of wage-earners 
to wage-payers, with some mention of those with small 
homes or very moderate means, who do not work for wages 
and do not pay wages. I will begin by requoting the state- 
ment of the newly elected Master Workman of the Knights 
of Labor — -Mr. Sovereign— as follows : 

''A republic that will deliberately squeeze the manhood out of 
200,000 tramps to make a Yanderbilt, a Gould, or an Astor, and 
abrogate the birthrights of millions of God's deserving children, 
that a few may hold titles to a million homes which they cannot 
occupy, and aid the private monopoly of natural bounties and the 
great agencies of distribution, is a disgrace to the name it bears 
and the flag it floats. In this repubhc the wild brutes, birds, and 
fishes hve and enjoy life without labor, yet civilized and intelligent 
man labors and starves. But worse still is the fact that one man 
produces much and enjoys little, and another produces little and 
enjoys much.'' 

In reading the complaints which labor makes against cap- 
ital, you will observe that the monopoly of natural bounties 
is among the leading charges. The buying up of land, for 
example, is counted as one of the principal methods em- 
ployed by the rich to produce little and get much. 

A friend has placed in my hands a copy of a nonsec- 
tarian paper [The Religio-Philosopliical Journal) which 
probably represents the feehng among that class of people 
(Freethinkers, they call themselves) to as great an extent 
as the Methodist conference, before quoted, represents the 

95 



THE LABORER AND THE CAPITALIST. 

feeling among those who are intimately connected with the 
churches. 

The aforesaid journal contains an article entitled " The 
Kobberj of Labor." The author signs himself W. Whit- 
worth, Cleveland, 0. He says: 

*'In this limited article I can only point out a few of the plun- 
dering methods J)y which the laborer is robbed of his earnment. 
First, the infamous plundering of the laborer by means of land 
monopoly. Here in Cleveland was a tract of land secured for a 
few hundred dollars ; a portion was given to a railway company 
for the planting of their shops thereon and lots sold to workmen 
at a cheap rate." 

This paragraph, evidently sincere, and written with no 
inconsiderable ability, is, nevertheless, misleading and with- 
out value as an economic proposition. It ignores the very 
truths necessary to a correct understanding of the princi- 
ple involved. 

The author states that a portion of this land was sold to 
the poor workmen at a cheap rate; he omits to state the 
important fact, however, that these poor workmen are sharers 
in the rise which has taken place in the value of the land 
in question. 

The complaint against the whole scheme appears to rest 
upon the idea that land ought to be common property. 
The writer should have stated, therefore, that the poor 
workmen owning a share are no less robbers than those who 
own a larger portion, since, according to his own theory, 
they have gained wealth without effort of their own. 

Again, when it is alleged that a robbery has taken place 

96 



THE LABORER AND THE CAPITALIST. 

which has greatly impoverished the people, the extent of 
the impoverishment ought to be clearly set forth. 

For the sake of the argument let us suppose that the afore- 
said land was taken hy the rich without any consideration 
whatsoever. Now, what was the extent of the robbery ? 

If land is common property by natural right, of course 
it belongs to all the people. If the present value of the 
lot in question be $1,000,000, for example, an equal division 
of the loss would result in less than two cents to each in- 
habitant of the United States. If this value has been fifty 
years in accumulating, the loss to each inhabitant would 
have been a cent once in twenty-five years, about the cost 
of one whiff from a cigar per annum. Of course, this does 
not justify the taking of land without rendering an equiva- 
lent therefor, but the transaction cannot have done much 
toward impoverishing the people, in any event. 

The writer continues thus : 
''In like manner every rod of the city has been manipulated by 
this infamous robber method of building up millionaires at the 
cost of crushed workmen. Not a farm for miles in the outskirts 
that is not laid off into " allotments " for the homes of laborers at 
from ten to twenty times the cost of purchase given by the vam- 
pire horde of land speculators. . . . The farmer and work- 
man carry the whole grievous burden." 

This is according to the popular method of computing 
the losses which the many are supposed to suffer through 
the purchasing of land by the few ; but there are certainly 
some mistakes in Mr. Whitworth's calculation. 

It cannot be said that the workmen who received their 

97 



THE LABORER AND THE CAPITALIST. 

land before the rise took place are being burdened ; on the 
contrary, the advancing price is putting wealth into their 
pockets. It should also be remembered that these farms 
which are being divided into allotments, etc., have been 
sold by their former owners at a greatly enhanced price, 
and that the value of all adjoining farms has been increased 
by the same transaction. 

Indeed, the value of all farms is enhanced by the very 
process complained of by Mr. Whitworth. How, there- 
fore, can he say that farmers are being burdened thereby? 
And as to the laborers, have their wages ever been reduced 
by the division of farms into allotments and the rearing of 
cities thereon ? 

Indeed, when and where has such a process gone on that 
the demand for labor has not increased and wages raised ? 

In the sweeping charges which the writer makes against 
capital, building associations come in for a share. He says : 
*'The Shy lock greed of loan and building associations, levying 6 
per cent, interest on a ten-years' purchase, etc.'^ 

I am not certain whether Mr. Whitworth intends to con- 
demn building associations altogether, or whether the rate 
of interest they charge is the issue he makes. 

At all events, he appears to have entirely overlooked the 
fact that the interests of building associations, like those of 
aU other forms of associated capital, are one with the inter- 
ests of the people. If these associations charge a burden- 
some rate of interest, they will sell less property, for the 
all-sufficient reason that the people will be obliged to pur- 
chase less. You cannot increase your own income by ren- 

98 



THE LABORER AND THE CAPITALIST. 

dering' would-be customers less capable of buying your 
goods. 

Again, when Mr. Whitworth asserts that the building 
and loan associations charge 6 per cent., and stops there, he 
omits the most important element in the problem, to wit ; 
the payer's rent is practically deducted from this 6 per 
cent; that is, when one has secured a home through a 
building association, he immediately moves in and pays no 
rent. As a rule the sum ordinarily paid for rent, if invested 
in a building association in monthly installments instead of 
handing it over to the landlord, will make one the owner of 
a home in about 144 months — twelve years. In any event, 
the interest cost to the purchaser — that is, the difference in 
the interest and the amount usually paid for rent — must be 
very small, certainly less than 3 per cent. 

Building associations in the United States date back 
fifty years or more. They have been coming into existence 
very rapidly of late, however, so that their average age is 
about six years. They have secured to the American people 
about one million homes, sheltering a population larger 
than that of Ireland, and nearly as large as that of the 
State of New York. 

They had their beginning in Philadelphia. They have 
built about 75,000 homes there, and saved about another 
25,000 to the people by liquidating mortgages and giving 
the owners longer time to complete their payments. 

Building associations have made the population of Phil- 
adelphia more generally home-owners than that of any 
other city on the globe. If this is the kind of robbery the 

LofC. 99 



THE LABORER AND THE CAPITALIST. 

"greedy Shylocks" are doing, may the hours fly and the 
days hasten till the whole earth is robbed in the same way ! 
To more perfectly illustrate the lesson Mr. Whitworth 
would inculcate, we copy the following from his further 
statement : 

^' There is no test so good as experience. I came to this country 
fifty years ago, a plain workman. During the greater portion of 
that period I have wrought at the bench as a skilled mechanic. 
Had I gone into the grab game of speculative gambling or money 
lending I could easily have become a millionaire long ago. I feel 
thankful to God that I kept on in the honest role of earning all 
I gained, because to attain millions I must inevitably have wrung 
it from the hard-earned production of others." 

These words sound honest and earnest, and they may 
thrill the great heart of labor, but truth compels us to 
state that they are illogical, and cannot perform any useful 
office for industry anywhere. 

We have already demonstrated that millions are as hon- 
estly earned as smaller amounts, and that those who gain 
the larger fortunes usually render mankind the greater ser- 
vice. 

Now let the laborer grapple with the following propo- 
sition and learn the lesson it teaches. 

If the course which Mr. Whitworth claims to have pur- 
sued had been pursued by the people whom we now find 
rich among us, who would have employed the labor of the 
country, and v^^hat would have been the fate of the poor ? 
People are born without homes ; to get homes they must 
receive wages ; therefore it seems to us that the greatest 

100 



THE LABORER AND THE CAPITALIST. 

benefactors of this age are those who have had the dispo- 
sicion and energy to acquire wealth, which has compelled 
them to employ labor and pay wages, a thing which our 
honest friend Whitworth has not done. 

We cannot say whether or not more land was donated to 
the railroad company mentioned by Mr. Whitworth than 
was necessary to induce it to locate car shops in Cleveland. 
Certain it is, however, that whether the donation was large 
or small, or whether it was made by pubHc or private au- 
thority, it was in anticipation of reaping a greater benefit 
than appeared likely to accrue from any other disposition 
the donating power knew how to make of it. 

Before our honest friend asserts that labor has been 
robbed in consequence of the disposition which has been 
made of the aforesaid land, he should show that the gain 
which has resulted therefrom would have employed more 
labor through other hands than it has employed through 
the hands of the railroad corporation and others who have 
received the profits he complains of. 

This he cannot do ; neither can he show that laborers 
have been excluded from said land. On the contrary, they 
have been brought there and provided with employment in 
largely increasing numbers ; and to-day they share the ben- 
efits which unquestionably result to the whole community 
from the accumulation of wealth which has taken place on 
the land in question. 

I rejoice in the discussion now going on in the ranks of 
labor. It is the one safe and peaceful road to the redress 
of grievances and the solution of the problem before it. 

101 



THE LABORER AND THE CAPITALIST. 

Labor must learn the science of its own progress and act 
from a positive knowledge of its relation to the world about 
it, and not depend upon outside advice. 

Labor has had the misfortune to have been sadly misled 
in several important particulars by some of its staunchest 
and most intelligent friends. Not many years since a Pres- 
ident of the United States (Gen. Grant) declared that wages 
were always first to fall and last to rise. There was an 
abundance of authority for such a statement ; that is, if it 
be proper to call hearsay evidence authority. Thousands 
of distinguished men (friends of labor) had believed and 
said the same thing. 

In fact, we find this opinion expressed all through eco- 
nomic Hterature. This, of course, leads the laborer to believe 
that when anything bad happens to the industrial world he 
suffers first and suffers longest. Nevertheless, such is not 
the case. When depressions come, capital and labor suf- 
fer equally ; but capital receives the first shock. There is 
never any general cutting of wages till after capital has 
suffered a loss of profits. Capital may not be any too good 
to cut wages, but when an employer has his factory filled 
with hands, trained to his work and accustomed to his 
methods, he hesitates to cut wages lest he lose his 
hands. 

Nine-tenths of the failures in business could be prevented 
if employers of labor were to promptly cut wages when 
prices begin to fall and profits shrink. But when this takes 
place, employers wait, and wait on, expecting a rise in prices 
and an increase of profits, which are always followed by 

102 



THE LABORER AND THE CAPITALIST. 

more or less scarcity of help wlien trained hands are hard 
to get. 

Therefore, employers, as a rule (for sheer husmess 
reasons), continue the same rate of wages long after their 
profits have begun to shrink, and many of them until they 
are overtaken by bankruptcy. 

But loages are the last to rise. The reason is very plain. 
When, after difall in the price of goods, a rise takes place, 
the employer feels justified in allowing wages to remain un- 
changed, because through higher prices and larger profits 
he is recovering the loss he sustained while prices were fall- 
ing. Then, too, he is more or less selfish, and does not 
volunteer to raise wages, but awaits a demand from the 
labor market, precisely as the workman awaits a demand 
from the employer to receive smaller wages when prices are 
falling:. 

So wages do not fall first and rise last, but fall last and 
rise last. This is as it should be. Labor does not get a 
rise as early as capital, but when the rise does come, it very 
justly lingers for a time after the profits of capital have 
begun to dwindle. How wonderfully does Nature make 
one hand wash the other, how unerringly she maintains a 
just balance between all her forces ! She has not made 
labor a necessity and then left it at the mercy of capital — 
labor's own child. 

But, you say, how about the rates of wages — are they 
just ? No. In many cases the rate of wages is far from 
just, and so are the profits of capital, and it is plain that 
this world would be vastly benefited morally, and much 

103 



THE LABORER AND THE CAPITALIST. 

grief could be assuaged, if rich and poor would practice 
that rule (more than golden) which enjoins the doing by 
others as you would have others do by you. This would 
have every employer of labor pay all the wages he could 
afford, and every employee take care to earn all the wages 
he received. Of course, one is as apt to neglect this duty as 
the other. Some employers get their help for too small an 
outlay, precisely as some employees receive more wages than 
they actually earn. 

However, the law of mutual dependence makes it for the 
interest of all to be just. If the laborer is found not to 
earn his wages for any great length of time he is dis- 
charged; therefore the necessity for employment compels 
him as a rule to try to earn what he has agreed to receive. 
On the other hand, the desire for gain will as a rule move 
the employer to pay all the wages he can afford. To illus- 
trate : 

John Diamond is a manufacturing capitalist. He is on 
the alert to make money. I enter his factory. There are 
benches not manned, positions not occupied. I say, " Look 
here, Mr. Diamond, why is your factory not filled with 
hands ? " " Well," he answers, " it's because it don't pay to 
fill my factory with hands. I am employing all I can afford 
to employ at the present rate of wages." 

" Are you sure you are right about this, Mr. Diamond ? " 
" Why, yes. You know I am anxious to make money ; and 
if you will convince me that I can increase my profits by 
employing more hands I will engage them at once; I will 
man all my empty benches. I have never professed to be 

104 



THE LABORER AND THE CAPITALIST. 

much of a philanthropist^ yet I would like to give men 
employment. Some are idle ; they need work ; their fami- 
lies need the comforts it would bring ; but, above all, I would 
like to make a profit on their labor. So when you see a 
vacant position in my factory you may know it is because 
I cannot make anything bv paying the present rate of wages 
to fiU it." 

This illustrates an important principle in economics, and 
refutes the popular theory concerning wages and the profits 
of employers. Here are capitaHsts all over the wide world, 
hungry for profit, and there are more or less unoccupied 
positions in every country and in every industry, which 
proves that capital cannot afford to keep these positions 
filled at the present rate of wages. The never-failing test 
of the profits of capital is the employment of labor. To 
say that capital can afford, as a rule, to pay higher wages 
when, at the same time, men are idle, is to contradict hu- 
man nature. 

It is an unfortunate fact that strikes are more frequent 
and employers most blamed when manufacturing capital i&i 
yielding its smallest profit. 

CHAPTER Xn. ^^^^^' 

THE GULF BETWEEN CAPITAL AND LABOR. ooT* 

SociaHsm flourishes because of the belief that the preSeii^ 

regime does not, and never can, result in a fair division, of 

an DLut 

105 



THE LABORER AND THE CAPITALIST. 

the results of industry, and that a guK does, and necessar- 
ily must, exist between capital and labor. 

In Dr. Strong's work, pages 145-6-7, there appears the 
following : 

**Equality is one of the dreams of Socialism. It protests against 
all class distinctions. The development of classes, therefore, in a 
republic, or the widening of the breach between them, is provoca- 
tive of Socialistic agitation and growth. Among the far-reaching 
influence of mechanical invention is a tendency, as yet unchecked, 
to heighten differences of condition, to establish social classes, 
and erect barriers between them. In a sense classes do and must 
exist wherever there are resemblances and differences ; but so 
long as the individual members of social classes easily rise or fall 
from one to the other by virtue of their own acts, such classes are 
neither unrepubHcan nor unsafe. But when they become practi- 
cally hereditary, differences are inherited and increased, antipathies 
are strengthened, the gulf between them is widened, and they harden 
into castes which are both unrepublican and dangerous. Now the 
tendency of mechanical invention, under our present industrial 
system, is to separate classes more widely, and to render them 
hereditary. 

^'Before the age of machinery, master, journeymen, and appren- 
tices worked together on familiar terms. The apprentice looked 
forward to the time when he should receive a journeyman^ s wages^ 
and the journegman might reasonably hope some day to have a 
shop of his own. Under this system there was little opportunity 
to develop class distinctions and jealousies. 

* ' Tools were not so expensive but that the workman might own 
them. And if he did not like his employer he could leave, taking 
with him the means of earning a livelihood. If he did not easily 
find another employer he could somewhere set up for himself. 

lUG 



THE LABORER AND THE CAPITALIST. 

This single fact of owning Ms tools made him independent. 
But the introduction of machinery changed all this. It could not 
be carried from place to place like a kit of tools. It was too ex- 
pensive for the workman to own. Without the machinery, owned 
by the employer, he was helpless. If he found himself out of a 
job he could not set up for himself. He has lost his independ- 
ence. Thus machinery has developed a dependent class. 

^* Moreover, machinery has rendered it vastly more difficult to 
rise from the condition of an employee to that of an employer, thus 
separating these classes more widely. Once they were only a step 
apart. That step could be taken by a workman's employing 
another. They worked side by side until the business demanded 
another "hand," and then another, until the little shop had grown 
into a large one. Thus gradually the workman acquired capital 
— a course open to every mechanic. 

'^But since the introduction of machinery a considerable capital 
is necessary to make a beginning. It is found that, other things 
being equal, the small factory cannot compete with the large one, 
hence fortunes are massed and factories become immense. A 
mechanic, hy some Jiappy invention or through remarlcohle abili- 
ties, may yet become a capitalist and an employer, but the con- 
dition of the average operative to-day is separated from that of 
his employer by an almost impassable gulf^^ 

On page 150 Dr. Strong further says : 

'*It is easier to arouse the discontent of the workman now than 
it once was, among other reasons because the introduction of ma- 
chinery and the division of labor have made a large proportion of 
work monotonous and void of all interest. Formerly in every 
trade there was a great variety of worh. A blacksmith, for 
instance, was not master of his trade until he could make a 

107 



THE LABORER AND THE CAPITALIST. 

thousand things^ from a nail to an ij^on fence. There was relief 
from monotony and scope for ingenuity and taste. But ma- 
chinery is introduced, and with it important changes. It is dis- 
covered that the subdivision of labor both improves and cheapens 
the product. And this double advantage has stimulated the ten- 
dency in that direction until a single article that was once made 
by one workman now passes through perhaps three score pairs of 
hands, each doing a certain part of the work on every piece. 
Manchester workmen, complaining of the monotony of their work, 
said to Mr. Cook: "It is the same thing day after day, sir; it's 
the same little thing ; one little, little thing, over and over and over." 

If there is really a gulf between capital and labor, cer- 
tainly aU good people will be anxious to know its exact 
location and to bend their energies to the noble work of de- 
stroying it. And what can be more convincing to the general 
public than the arguments just quoted ? However, in a 
previous chapter I have recommended that each individual 
ihall test all arguments in the crucible of his own reason. 
Let us apply this principle to the propositions of Dr. 
Strong. 

He says that before the introduction of machinery, " the 
apprentice looked forward to the time when he should re- 
ceive a journeyman's wages." The good Doctor also states 
that formerly in every trade there was a variety of work ; 
that a blacksmith, for instance, " was not master of his 
trade until he could make a thousand things, from a nail to 
an iron fence"; but that now the workman is confined to 
the monotony of making one thing day after day, over and 
over. The result of all this, according to Dr. Strong, has 

108 



THE LABORER AND THE CAPITALIST. 

been to develop huge manufactories and to open almost an 
impassable gulf between capital and labor. 

Without the slightest thought of reflecting upon the 
candor or ability of Dr. Strong, I must say that the very 
elements most needed to give the reader a clear under- 
standing of the subject are not taken into account in his 
argument. 

He admits that it has been discovered that the present 
system (the subdivision of labor) both improves and cheap- 
ens the product, but his accompanying comment, to wit : 
" The introduction of machinery and the subdivision of 
labor have made a large proportion of work monotonous 
and void of all interest/' is calculated not to enlighten the 
workman, not to make him philosophic, but to befog him, 
and to over-intensify the restless spirit of the masses. 

A certain kind of unrest is natural. Some one has wisely 
characterized unrest as divine. Make the human race con- 
tented, and progress would stop, and great discoveries and 
new inventions would no longer attract attention nor cheer 
the world with the prospect of a happier future. I be- 
lieve in restlessness, but it should be considerate and phil- 
osophic. 

Why not try to make the workingman feel the all-im- 
portant truth that the new system of manufacture should 
not be regarded as more monotonous than the old, because, 
as a matter of fact, it is not. The custom shoemaker of 
the present day, for example, who makes every part of the 
shoe as he formerly did, is quite as restless and complains 
as much of his situation as the factory hand whose work is 

109 



THE LABORER AND THE CAPITALIST. 

narrowed down to the driving of the nail, the trimming of 
the heel, or the making of the edge. 

Again, why not state the fact that the better and cheaper 
product of the new system is greatly to the advantage of 
the workingman, since it has made it possible for him to 
have a thousand things that only the rieh could enjoy be- 
fore the introduction of machinery. 

Again, why not show forth the almost incalculable ad- 
vantage which the new system has over the old in that one 
who desires to become a mechanic does not have to give the 
best part of his life to the learning of a trade ? He is not 
obliged to look through seven long, dreary years of appren- 
ticeship to a journe^rman's wages, but walks straight to the 
factory, as it vfere, and receives his wages at once, and thus 
at least one-third of the most active period of his life is 
saved to the workman — a sufficient length of time to acquire 
the foundation for a large fortune, if that be his aim, or to 
possess himself of an education which was entirely beyond 
the reach of the apprentice under the old system, which 
demanded that one should learn to do a thousand things in 
order to earn a mechanic's wages. 

Dr. Strong makes a very unfortunate mistake when he 
falls into the common error " that machinery has rendered 
it vastly more difficult for an employee to rise to the position 
of an employer," and " that it is harder for the workingman 
to acquire capital." The latter proposition cannot be true, 
since wages are vastly higher and the necessaries of life 
much cheaper. And the former statement is mathematically 
refuted in our chapter on corporations, in which it is shown 

110 



THE LABORER AND THE CAPITALIST. 

to a certainty that rapidly growing associations of capital 
are opening tlie door wider and wider to small investors, 
and that through this avenue the people are employing one 
another as never before. What is this but the employee 
rising to the position of an employer more easily than for- 
merly ? 

Let these facts be made clear as they exist, and alto- 
gether a new feeling will take possession of the masses, 
for it is not truer that light emanates from the sun than it 
is that the modern methods of manufacture described by 
Dr. Strong as naturally calculated to make the masses dis- 
satisfied and unhappy, ought to have the very opposite 
effect, and will when rightly understood. 

However, the central subject for discussion in this chap- 
ter is the gulf between capital and labor. Dr. Strong thinks 
that it exists and is almost impassable. The idea of a gulf 
between capital and labor is old, and the existence of this 
cruel chasm has been talked about and beheved in from 
time immemorial ; but, so far as we know, nothing has been 
said or written upon the subject from which one can draw 
any definite conclusion regarding its location, etc., except 
that it is where the larger portion of the human race tarry 
and toil and suffer, while the smaller portion go on pros- 
perous and happy, encountering but very little hardship. 

It is getting to be the popular belief that this merciless 
condition is to exist until government takes the matter in 
hand, and our present economic system is swallowed up in 
a co-operative commonwealth or SociaHsm. 

If there is a gulf between capital and labor, where does 

111 



THE LABORER AND THE CAPITALIST. 

it begin, and who has created it? Of course the popular 
theory is that the capitalists have created it. We never 
heard it said that laborers were creating any gulf between 
capital and labor, or that they stood in the way of any- 
body's success. Of course, then, the capitalists have opened 
the fearful chasm. 

Very well, when we say that capitalists are the guilty 
ones, what capitalists do we mean ? Eemember, we are all 
capitalists, pursuing the same end and emplo3dng the same 
business methods. We differ only in the "size of our 
pile," as the saying is. 

Now, it so happens that more than one-third of the labor 
of the country is employed by comparatively small capital- 
ists, many of them very small. Most farmers employ labor, 
and the average value of farms is not above three thousand 
dollars. Custom shoemakers, custom tailors, tinners, plumb- 
ers, carpenters, blacksmiths, etc., are small capitalists; 
but, like farmers, they are numerous, and although each 
employs but little labor, the aggregate amounts to a great 
deal. 

These capitaHsts work side by side with their help. Their 
hands are as horny and their clothes as ordinary as those 
of their employees. It will not be pretended that these peo- 
ple are creating a gulf between capital and labor. Nobody 
thinks of them as standing in the way of the better success 
of anybody. Then, of course, the gulf is the work of the 
larger capitaHsts. 

Let us see. As a rule, the larger capitaHsts pay higher 
wages than the smaller. They sell goods at lower rates 

112 



THE LABORER AND THE CAPITALIST. 

and they employ more help. Now, if employing more help, 
paying higher wages, and selling goods cheaper are open- 
ing a gulf between capital and labor and hindering the 
people, then, in the name of common-sense and for the sake 
of humanity, tell us what will help the people. 

Whether a fortune is measured by hundreds or thou- 
sands, or whether it reaches into millions, is not material. 
Those who live under the same government buy and sell 
in substantially the same market, and pay and receive sub- 
stantially the same price for labor and whatever else is re- 
quired to make a fortune. 

Therefore, if the acquiring of a million has hindered 
anybody, it has hindered him who has acquired half a 
million; a half a million has hindered a quarter of a 
million; a quarter of a miUion has hindered a hundred 
thousand; a hundred thousand has hindered fifty thou- 
sand ; fifty thousand has hindered twenty-five thousand ; 
twenty-five thousand has hindered ten thousand; ten 
thousand has hindered five thousand; five thousand 
has hindered one thousand; and upon the same prin- 
ciple one who has acquired a thousand dollars has hindered 
him who has acquired five hundred, and so on down to 
the smallest difference. 

Again, when we come to wage-earners and those whom 
we call salaried people, the principle applies to their case 
with equal force. If Chauncey M. Depew's salary of fifty 
thousand a year hinders anybody, it hinders the man who 
receives twenty-five thousand ; that man hinders him who 
receives ten thousand ; that man hinders him who receives 

113 



THE LABORER AND THE CAPITALIST. 

five thousand; that man hinders him who receives two 
thousand ; that man hinders him who receives twelve hun- 
dred; that man hinders him v/ho receives six hundred; 
and upon the same principle, tha man who receives a salary 
of six hundred dollars a year hinders all who receive less. 

Where, then, is room for a gulf between any two classes 
that does not exist all along the line, from the lowest paid 
laborer to tlie wealthiest capitalist? 

The wage-earner receiving the smaller salary thinks his 
would be larger if those receiving more were out of the 
way or were paid less. The same is true of all classes, 
from the richest to the poorest, from the smallest income to 
the largest. 

The president of a corporation, with a salary of only ten 
thousand a year, beholds a great gulf between himself and 
Depew with a salary of fifty thousand. The capitalist 
whose wealth amounts to only a hundred thousand dollars 
beholds a still wider gulf between himself and the man 
with a million. The man with' a million looks hopelessly 
at the apparently intraversable distance between himself 
and a Rockefeller. 

Therefore, it would seem that this much-talked-of gulf 
is a creature of the imagination. It is always just ahead, 
yet has no permanent abiding-place. It is between every 
man and the position he desires to reach. 

The theory that the rich stand in the way of the better 
success of the poor is not sound. 

Let us illustrate : On yonder height, perchance by the 
sea, stands a magnificent dwelhng. It occupies the finest 

114 



THE LABORER AND THE CAPITALIST. 

site in all that region of country. Of course, nobody can 
be blamed or praised for the site, for the reason that nature 
created it. One site is more beautiful than another every- 
where, and all cannot occupy it at the same time. Some- 
body must take a back seat when it comes to beautiful 
building sites. However, the rich man owns the one in 
question, and the palatial structure that stands upon it. 
Of course he holds all this at the exclusion of the poor, but 
he holds it at the exclusion of the rich also. Eemember, 
the rich all want that site as well as the poor ; therefore, so 
far as any are excluded, rich and poor fare the same. 
However, a poor man once owned this beautiful spot and 
cultivated it with his own hands. 

Now consider that when the poor man occupied the 
site where now stands the stately dwelling aU the 
rest of the poor were excluded. The owner employed 
no help, so of course he was of no assistance to his 
wage-earning neighbors; they were left out in the 
cold so far as this spot of earth was concerned. But 
a rich man came and bought the poor man out. This 
did not hurt the poor man. He received pay for his 
improvements and whatever rise had taken place in 
the value of his property in consequence of settle- 
ments round about and near by. Of course the rich 
man had to have a costly house and costly surround- 
ings. To accomplish this he was obliged to call for 
labor, and he employed more the first year in creat- 
ing one building than would have been employed in 
ten, yea, fifty, years, had this same land been left 

115 



THE LABORER AND THE CAPITALIST. 

in the hands of the poor man. Not only did the 
rich man employ more labor the first year^ but he 
must continue to employ more. It requires constant 
help, and a good deal of it, to cultivate lawns, hedges, 
care for teams, and do the work of a rich man's 
household. 

Turn that rei^iowned thoroughfare in New York City 
known as Fifth avenue back into wheat-fields, potato 
patches, etc. (the condition it was in when in the 
hands of the comparatively poor), and ten men will 
cultivate it from end to end; while now, it is safe 
to say that ten thousand are employed there, with 
salaries more than a hundred per cent, higher than 
had been dreamed of before most of those costly 
dwellings were built. In short, the rich have come, 
not to open a gulf between capital and labor, but to 
employ more help and pay higher vv^ages. 



CHAPTER Xm. 

IS WEALTH CONCENTRATIlirG ? 

Nothing is more generally believed than that the wealth 
of the United States is being rapidly concentrated. 

Eeader, have you ever asked yourself the question, "Is 
it true?" Probably it has never entered your mind to 
doubt a proposition so universally admitted, preached, and 
acted upon. Great and good men say that the wealth of 

116 



THE LABORER AND THE CAPITALIST. 

the country is concentrating and the freedom of the people 
is thereby endangered ; everybody else seems to beheve it, 
and you behold a colossal fortune here and a goodly num- 
ber of poor people near by, and it appears perfectly plain 
that wealth is concentrating in the hands of a few to the 
woe of the many. And then follows the question : " Where 
and how shall we begin to remedy the evil ? " 

The Comraercial Advertiser ^ New York, March 2, 1894, 
has an editorial pertinent to this point, as follows : 

*^ 'In a multitude of counselors,' said the wisest of mortal men, 

' there is wisdom.' No one man or set of men knows it aU. 

*^The Morning Advertiser had adopted the expedient of calling 
upon its readers for their views upon the most important question 
of the day, the Social Problem. To this subject individual think- 
ers have addressed themselves for ages, striking a ray of light 
here, stamping out a fallacy there, and eliciting an imperishable 
truth elsewhere. Something has been done, indeed, and the 
world is ripe for the next advance. The enormous success of Mr. 
Bellamy's book, "Looking Backward," proves that the thought 
of the day is centered upon the practical working out of the prob- 
lem. 

'^Who knows but one of our own readers possesses, unsuspected 
even by himself or herself, the key to the problem which, once 
applied to human affairs, will make all things clear. 

*^ Therefore, if you have any views, any convictions at all on this 
subject, no matter how commonplace they may seem to you or 
how radical they may appear to others, put them on paper and 
send them to the Morning Advertiser" 

Undoubtedly there have been a great many responses to 
the generous invitation to the pubHc to discuss the Social 

117 



THE LABORER AND THE CAPITALIST. 

question through the columns of the Advertiser, and it is 
highly probable that a very large majority, if not all, of 
those respondents have proceeded with the discussion upon 
the theory that wealth is concentrating, and that such con- 
centration is against the pubhc weal. These premises being 
admitted, the rich man is very naturally discussed as the 
wicked progenitor of a great evil, since he is unquestiona- 
bly the concentrating power. 

In the first place, what do we understand by the word 
concentration as applied to wealth ? 

For wealth to concentrate, according to popular under- 
standing, it must move from the possession of the many to 
the possession of the few, without a fair equivalent. 

There are large accumulations of wealth, but if the the- 
ory I have advanced regarding the law^ of exchange, which 
I claim compels each one to give value equal to that which 
he receives, be sound, there has been no general accumula- 
tion of wealth in the hands of a few without an equivalent 
having been rendered. The reason that the working of 
this law is not more readily seen is largely owing to the 
fact that the popular gaze is so fixed on the exceptions, 
which are common to all rules. 

The people are trading, rich and poor ; goods are being 
exchanged for labor and labor for goods, according to the 
general market price, which represents the best judgment 
of the people at large as to the value of goods. This is 
evident from the fact that the people at large have estab- 
lished the market price and that, as a rule, they base their 
contracts upon it. 

118 



THE LABORER AND THE CAPITALIST. 

If Socialism were in the ascendancy, and the government 
were to divide the products of labor between man and man, 
how could it do better than to order the exchanges made 
according to the best judgment of the whole community, 
which is now represented in the general market price of 
goods and of labor as well^/ 

As we have previously stated, the world is doing its trad- 
ing, exchanging goods for labor, and labor for goods, upon 
the theory that the general market price is the best rule to 
go by as to how much money shall be received in exchange 
for a given quantity of goods or a day's work, or how 
much of one kind of commodity shall be received for a 
stated quantity of another. I feel warranted in saying 
that Sociahsm has not, neither can it invent, a system for 
the distribution of the results of industry that can ap- 
proach in fairness the one aheady in vogue. Neither can 
one be imagined that will stimulate honest effort to a higher 
degree. But here comes an unprincipled individual, or a 
trust, perhaps, and undertakes to raise or depress the mar- 
ket. They sometimes succeed for a time ; but the trans- 
action generally proves disastrous in the long run, even 
to the operators. It almost invariably follows that when 
the price of one or more kinds of goods is unnaturally 
inflated, they fall as far below the hne of honest profit as 
they have been raised above, so that the promoters of 
schemes for controlling the market usually lose as much 
from one extreme of price as they gain from the other. 
But how seldom do these things take place when we con- 
sider them in comparison with the vast volume of trade 

119 



THE LABORER AND THE CAPITALIST. 

that moves along unceasingly and undisturbed by such 
interference. 

This must not be taken to mean, however, that I justify 
unnatural interference with prices by individuals or corpo- 
rations ; neither do I say that such things ought to be per- 
mitted. I simply wish to show that, on the whole, it is not 
a money-making business, even for those who engage in it, 
and that such interference does not argue against the the- 
ory that the system of exchange I am defending is the 
best that can be devised, any more than the gullying of 
lands by floods and the occasional uprooting of trees here 
and there by the wild wind argue against the general util- 
ity of the Infinite plan for watering the earth with rain 
storms. But the attention of the world is so fixed upon the 
unusual occurrences that the harmony of the general plan 
receives but Httle attention. Then, too, these colossal for- 
tunes on one hand and widespread poverty on the other are 
constantly before the eye and in the mind. " If there has 
been no concentration of wealth, how can such differences 
come ? " is the anxious, unceasing inquiry the world over. 

I have abeady discussed this matter in a general way, 
but a few pointed illustrations will, I trust, make the 
principle more easily understood. 

For example : Astor is said to have built several thou- 
sand houses. Of course, it will not be denied that the 
building of the first helped the community and added to 
the wealth of others as well as to that of Astor. If this be 
true, the same result has necessarily followed the building 
of the last house and aU the intermediate ones. Why not ? 

120 



THE LABORER AND THE CAPITALIST. 

But, according to popular theory, Astor has built too 
many houses. He ought to have let others build more. 
Has Astor prevented others from building houses ? And 
if others had built the same houses that Astor has built, would 
they have employed more help ? Or would they have bought 
more material from the people than Astor has bought ? If 
not, what would have been the . advantage to the general 
public in having others direct those building operations in- 
stead of Astor ? 

But it must not be supposed that others would have built 
those houses if Astor had not. Others have not built less 
because Astor has built more. On the contrary, every ad- 
ditional house built by him, or built through his energy, 
has created a market for more of the people's labor and 
material. 

This has necessarily increased the opportunities of others, 
not only to build houses, but to engage in whatsoever other 
enterprises they saw fit. 

Astor is reputed to be the largest real-estate owner in the 
country, Pulitzer the richest printer. According to the 
popular idea both are great monopolists. Should you desire 
to read a rating and berating of Mr. Pulitzer by a labor 
pubhcation, see The Twentieth Century, October 12, 1893. 
However, Mr. PuHtzer has lately reared the most valuable 
structure of its kind on the globe. It is the most costly 
home a newspaper ever had. It is a comphment to the 
business talent of its owner, and an ornament to the city 
above which it towers so grandly. I watched it while it 
was in process of erection ; I heard the sound of the trowel 

121 



THE LABORER AND THE CAPITALIST. 

and the hammer ; I was glad as, day by day, it mounted 
skyward, still skyward, tiU the gilded dome almost touched 
the clouds. And when it was finished I wished that its 
owner might build a thousand like it, since every pound of 
stone, every pane of glass, every foot of lumber, every 
brick, every nail, every drop of paint, etc., would have to be 
bought of labor. And then, every dollar received for rent 
would be used to purchase labor, or goods produced by 
labor, so that after Pulitzer shall have passed from earth 
the building he has reared will continue to administer to 
the wants of the human kind. 

The benefits accruing to the general public from the ef- 
forts of great financiers are less understood and appreciated, 
owing to the fact that what they (the financiers) gain for 
themselves as a rule remains largely in one locality, where 
everybody can see it, while that gained by others as a result 
of the efforts of the financiers, is scattered. 

Let us illustrate the principle by a reference to the two 
men just discussed — Pulitzer and Astor. 

New York is the seat of their business. Jones has per- 
formed labor for them. The money paid him he has taken 
to a far-away State to use in the purchase of a home. Smith 
has sold them paint, glass, etc.; the brickmaker has sold 
them brick; the quarryman has sold them stone; the 
lumberman, lumber. With the profits realized from such 
sales, these merchants and laborers have employed other 
labor, erected buildings in other cities, or, perchance, built 
ships that now float on distant seas. In other words, what- 
ever Pulitzer and Astor gain is piled up in New York, 

122 



THE LABORER AND THE CAPITALIST. 

where it is created, while that which has been gained by 
the great number who are now and have been employed by 
them, and who have enjoyed their trade, has been carried 
in fractional parts to the east, to the west, to the north^ 
to the south, and has become so mixed and interwoven 
with gains from other sources that it cannot be pointed out 
as having been helped into existence by the energy of 
Pulitzer and Astor. But it has, nevertheless ; it exists as a 
result of their wealth which we see piled up in New York; 
so that their energy has not centralized wealth in the sense 
of taking without rendering an equivalent. On the contrary, 
their efforts have helped others precisely as they have helped 
Pulitzer and Astor, for the all-sufficient reason that they 
have been obliged to buy as much of others as others have 
bought of them. This is a beneficent law of nature, 
against which the selfishness of men cannot prevail. 

In the absolute sense, the capitalist is as much the em- 
ployee of the laborer, as the laborer is the employee of the 
capitalist. The laborer is employed and prospers precisely 
as the capitalist buys his labor ; the capitalist is employed 
and prospers precisely as the laborer purchases his goods. 
Or, to state the same fact in another way, that v/hich the 
capitalist pays out to the people for their labor and products 
is precisely that which the people pay back to him for his 
labor and products. One exactly balances the other, no 
more, no less. How, therefore, can one flourish at the ex- 
pense of the other, or how can one be made to suffer with- 
out involving the other? 

Infinite Wisdom has made labor a necessity, and provided 

123 



THE LABORER AND THE CAPITALIST. 

accordingly. We can neither eat, drink, nor wear our 
money; we must spend it or cease to exist upon the earth. 
And the precious fact is that, however unwisely we spend it, 
labor is sure to get the benefit. 

If the rich found private collections of art, as the good 
chaplain, before quoted, complains, it costs money, and 
every farthing of that money goes to labor, not to any par- 
ticular class, but to every variety of labor. 

The money paid for a picture is received by the artist in 
the first instance. He, like everybody else, being unable 
to eat, drink, or wear it, must lay it out for something which 
other laborers produce. 

If the rich stock their cellars with wines and liquors, the 
money paid goes to the merchant, from the merchant to 
the brewer, from the brewer to the farmer for corn, rye, 
grapes, or whatever has entered into their composition, and 
from the farmer to his help, etc. In short, the money that 
stocks the rich man's wine cellar finds its way to every in- 
dustry and to every toiler. 

This by no means justifies one in buying that which is 
not for his own highest good ; but if he will indulge in wine 
and luxurious living the money so expended is as certain to 
find its way to the pockets of the good and frugal through 
that channel as through any other. 

Every additional servant employed by the rich takes a 
laborer from other fields, bettering the condition of all. If 
they build a yacht, the money paid reaches not only the 
yacht builder, but the lumberman, painter, nail and sail 
maker, etc. 

124 



THE LABORER AND THE CAPITALIST. 

Let them build their pleasure boats and rear their palaces 
to the skies ; let them have their rich pianos and gaudy 
trappings — the more numerous and costly the things they 
buy the better it is for the skilled laborer who must be em- 
ployed to produce them. 

When I was casting about for a stenographer to whom I 
wished to dictate the contents of this volume, I came across 
an intelligent gentleman of that profession, who, in the 
course of the conversation, asked some questions with regard 
to the nature of the work I had in hand. I told him it was 
a work in which I thought of discussing monopoly. 

"Will you undertake to defend monopoly?" he asked. 
I answered that I would not defend anything that was 
wrong in monopoly. 

" Why," said he, " you will not insist that it is right 
for one man to have a hundred millions, while his next door 
neighbor is without a dollar, will you? " 

This gentleman's mind is a fair index to the popular mind 
regarding such matters. 

Now the question, and the all-important question, in the 
case is this : Are the rich man's neighbors poorer on 
account of his wealth ? Have they had fewer opportunities 
because he became rich ? There is not a toiler on the soil 
of America whose opportunities to have dollars, if you 
please, have not been increased by the business energy of 
the rich man. The men he has employed could not have 
been employed without him. " Now, hold on," says one, 
" if the rich man had not carried on that railroad business, 
somebody else would." Very well, but it would have 

125 



THE LABORER AND THE CAPITALIST. 

called that somebody else from fields where he is now 
employing other labor. The truth is, every human being 
that comes into the world, fills a niche that no other being 
or beings can fill. 

When one passes from earth another may step into his 
shoes, as the saying is, and continue the same business 
with, perhaps, equal success, but could the former have re- 
mained at his. post the latter would have been left free to 
exert his energy in other directions and to employ labor in 
other enterprises. 

It is a self-evident truth that, as a rule, whatever any one 
human being plans or executes, whatever he accomphshes 
with head or hand, is so much added to the sum total of what 
before existed, or to what could have existed without him. 

But why prolong the argument ? There is a way to set- 
tle the question as to whether our great financiers concen- 
trate wealth or diffuse it ; whether they are a hindrance 
to the poor or a benefit. If weeds are found in the corn- 
field, remove them, and the corn grows faster. Allow the 
weeds to grow again and the corn immediately becomes 
choked, and shows the effect in slower and less satisfactory 
growth. Now, if the rich men are weeds, if they choke and 
hinder the financial and moral growth of the people, the 
Southern States ought to be the poor man's Eden. There 
are very few rich men and corporations there with their 
cruel factories overworking women and children, as well as 
men, and underpaying everybody. The thing most needed 
in the generous and hospitable South is a larger number 
of rich men and more great corporations. 

126 



THE LABORER AND THE CAPITALIST. 

The question is often asked: Why do not these rich 
men give their help some of the advantages resulting from 
their great business talent? Why do they selfishly put all 
they gain in their own pockets ? This is a very important 
question, and one that stirs a deep feeling in the heart of 
labor. It calls many an angry expression from the lips ofx 
employees ; but a principle is here involved which the 
popular gaze has not reached. 

No laborer will ever ask the same question after he has 
learned the effect of what he calls the selfish pocketing of 
profits by great financiers. 

Imagine Eockef eller and Vanderbilt, for example, calling 
the working people of the country together and address- 
ing them as follows : 

" Wage earners, we are employing a great many thou- 
sand hands. We are paying them as much wages as 
others are paying who employ a smaller number. Our 
wealth is increasing rapidly, and all we gain we are using 
to extend our business. We build a house or factory here, 
a depot there, a railroad somewhere else, and so on. All 
of which compels us to hire more and more labor. But we 
have concluded that we are rich enough ; so from this on, 
we will divide our profits among our hands. Wage earners, 
what do you think of it?" 

The hands in their employ would say, " We like it." 
But all outside would say : " Now, gentlemen, please don't 
do it. You are paying the market price for hands at the 
present time. Why should you raise their wages and make 
them so much better off than the rest of us ? Why not 

127 



THE LABORER AND THE CAPITALIST. 

continue them as they are and use your surplus profits to 
extend your business and hire more hands, and thus give 
the rest of us an opportunity to share the results of the 
talent which our common Parent has given you ? " 

The two men just discussed do not use all their profits 
to extend their own business ; far from it. They are gen- 
erous supporters of charitable enterprises ; but to divide 
their accumulating surplus among their " hands " would 
not be wise charity, since it would concentrate the results 
of their business energy in the hands of their present em- 
ployees, while to reinvest it would diffuse it among a much 
larger number. Thus we see that the continual saving 
and reinvesting does not necessarily centralize wealthy 
though it makes some men very rich. 



CHAPTER XIV. 

HAS WEALTH CONCENTRATED? (CONTINUED.) 

Great confusion and many wrong conclusions regarding 
the centraHzation of wealth have arisen from a lack of thor- 
oughness in the study of principles underlying the distribu- 
tion of benefits arising from increasing values. The fol- 
lowing, copied from the Press, before quoted, December 
2, 1893, will help to illustrate our idea : 

"The present site of Chicago was sold by the Indians for three 
cents an acre. Taking the most valuable corner lot in the busi- 
ness part of the city as a criterion, the value has increased 130,- 

128 



THE LABORER AND THE CAPITALIST. 

000,000 per cent. In 1 830, when there were fifty people scat- 
tered around Fort Dearborn, a quarter of an acre of land in what 
is known as the " heart of Chicago " could have been purchased 
for 120. 

''In the past sixty-three years there were only two years in which 
the city did not show an increase in population over the previous 
year. But there were thirteen years during that time when this 
quarter of an acre of land showed a decrease in value, according 
to the real estate appraisement. 

''The greatest increase per cent, recorded was in 1835, when it 
rose in value 400 per cent, over the value of the previous year. 
With our latest knowledge of real estate '' booms "it is easy to 
picture the vision the owner must have had of the future glory of 
Chicago when he raised the price of his corner lot from $200 in 
1834 to 15,000 in 1835. To-day the lot is assessed at §1,200,000." 

This fact wiU generally be taken to mean that such an 
increase in the value of land in a single city means a tre- 
mendous concentration of wealth in the hands of a few, 
which wiU necessarily work hardship to the many. But, 
that such is not the case, is proven by the fact already 
mentioned in another chapter, to wit : When the value of 
one lot increases, the value of the adjoining lots increase 
also, and so on. 

When city lots increase in value, it is in consequence of a 
growing population aud larger trade, which calls for more 
of the products of the soil and enhances the value of the 
farmers' land as weU everywhere. 

A great many are of the opinion that the first purchasers 
of land, whether corporations or individuals, reap a benefit 
for which they render no equivalent, and in this way wealth 

129 



THE LABORER AND THE CAPITALIST. 

is concentrated. I refer, of course, to the rise in the value 
of land which it is claimed results, not so much from the 
energy of the first purchasers, as from the energy of those 
who come later. 

It cannot be denied that large fortunes have been real- 
ized through sudden advances in the value of land, con- 
sequent upon rapid settlement. Those who have had the 
energy and courage to invest early have sometimes reaped a 
rich reward ; but have not such men quite as often failed ? 
How many fortunes have been sunk through investing in 
land in anticipation of a rise, which either did not come, or 
came too late to save the investor from bankruptcy and 
ruin. Failures among land speculators are as frequent, in 
proportion to the number engaged, as in any other depart- 
ment of trade. 

Can it be shown that, as a rule, the early investors in 
New York, for example, have reaped a benefit not shared 
by the later investors? In other words, is the present 
value of New York city more the result of the efforts of 
the later than of the earlier settlers ? Let us see. 

Brown settled there first; then Jones came, which in- 
creased the value of Brown's property; but it increased 
the value of Jones's property also. Then, too, taxes and 
other expenses increased as the number of settlers increased. 
So that by the time the population of New York city had 
reached a million Brown and Jones had paid an enormous 
price for their possessions and an immense income was 
necessary to maintain them upon the very lots they had 
purchased long years before for a small sum. 

130 



THE LABORER AND THE CAPITALIST. 

Here is involved a principle of economics, which those 
who complain that the private ownership of land concen- 
trates wealth appear to have overlooked. I refer to the 
actual cost of land to the owners. 

If we reckon the usual rate of interest and the taxes paid 
and other expenses consequent upon the ownership of land, 
we shall find that the first purchase price, and in many 
instances the present value of every foot of land between 
Central Park and the Battery, has been paid by owners 
over and over again. 

A real estate agent lately stated that not long since he 
sold a piece of land in the city of New York for a gentle- 
man who had owned it forty years, and who was very 
happy over the price he was receiving. The agent sug- 
gested that he compute the interest on the money invested, 
the taxes, and other incidentals, and see what the expense 
had been from the first to last. When this was done, lo 
and behold, the land had cost the owner almost four 
times what he was receiving for it. How can it be said 
that, as a rule, the earher settlers have not contributed 
their share toward the present value of the whole city ? 

Take notice, if one-half of the wealth of New York city, 
say the half that has been accumulated by the later settlers, 
were to be taken away, the value of the remaining half 
would be greatly diminished, but no more than the value 
of the later accumulations would be diminished by the re- 
moval of the earlier. 

Therefore, the present value of the city is no more the 
result of the presence of the later than of the earlier ; no 

131 



THE LABORER AND THE CAPITALIST. 

more the coming of the last man than the first. And, of 
course, what is true of New York city is true of all cities 
and all lands. 

Much bad feeling has arisen regarding the ownership of 
land and landed corporations, owing to the supposed ten- 
dency of land to center in the hands of a few people. The 
popular belief is that the land of the country is f alhng into 
the hands of the rich in larger and larger quantities, and 
that the poor are being excluded therefrom. Such is not 
the case, however. Neither is it the tendency of land to 
concentrate in the hands of a few. In countries where the 
law of primogeniture and entail prevails, land, once in the 
hands of a few, is kept there by the force of statute law; 
but in the absence of that law the tendency of land in the 
long run is to diffuse. There has been a time when Man- 
hattan Island, upon which the great city of New York now 
rests, was probably owned by less than fifty persons. It is 
now in the hands of many thousands. 

Thirty years ago a very few owned the land upon which 
the city of Chicago now stands; what a great number own 
it at the present time ! As it is with cities, so it is with 
larger areas. Sixty years ago a few thousand people owned 
the States of New York and Illinois; now their owners are 
counted by the hundred thousand. 

The government has granted large tracts of land to rail- 
road corporations, in consideration of their building roads 
through certain sections of country — ^perhaps too much has 
been granted. Nevertheless, the interest of these corpora- 
tions now is to sell this land in the smallest possible quanti- 

13^ 



THE LABORER AND THE CAPITALIST 

ties to actual settlers, since the result will be a denser 
population ; and, therefore, more business and larger gains 
for the raiboads. A corporation has bought a large tract 
of land in eastern Tennessee, mainly from settlers owning 
all the way from ten to several hundred acres. 

At first glance this looks like a concentration of land in 
the hands of a few. In fact, it is a concentration in the 
first instance, but it hardly need be stated that in less than five 
years that land will be diffused among a population ten times 
larger than owned it before the corporation took it in hand. 

The government statistics show incontestably that land 
is diffusing. In the State of New York, from 1870 to 
1880, the acreage under cultivation increased only 7.2 per 
cent, while the number of farms increased 11.5 per cent. 
In Connecticut acreage increased 3.8 per cent. ; number of 
farms increased, 20 per cent. In Rhode Island acreage 
increased 2.5 per cent. ; number of farms increased, 15.8 
per cent. In Massachusetts, and indeed in all the older 
States, the land is diffusing in about the same ratio as in 
those mentioned. 

In some of the newer States, however, there is a sHght 
difference the other way, owing to the fact that so 
many immense cattle ranches have been established and 
reckoned as farms. But as civilization approaches and 
settlements draw near, it will not be profitable to hold these 
large tracts of land for pasturage, and they too will diffuse 
among the people. 

If from any cause, some of those who now own large 
tracts of land sell at a great profit, we know that those 

133 



THE LABORER AND THE CAPITALIST. 

adjoining are better off also. Nothing can enhance the 
value of large estates that will not at the same time en- 
hance the value of the smaller ones in the same ratio. 
Where, then, is the concentration ? In other words, how 
can it be shown that the larger are taking from the smaller ? 

Foreign syndicates have bought large tracts of land in 
this country, and in some instances they are leasing to a 
class of imported farmers, whose habits of living enable 
them to become dangerous competitors for our American- 
born farmers. I do not believe that that kind of land 
monopoly results in the good of all. The matter should be 
looked into, and our agricultural interests protected. 
This cannot injure the imported farmer, since whatever pro- 
tection is extended to the American-born farmer, will reach 
the imported farmer as well. 

However, the cases in question are exceptions. As a rule, 
landed corporations are a blessing to the people, for the 
great reason that their interests are one with the interests 
of those needing homes. They have bought large tracts of 
land in different parts of the country. To increase the value 
of this land, so as to make it yield a profit for the present 
owners, there must be settlers. And, in order to secure 
these settlers, the corporations must employ labor to make 
roads, to dig ditches, to build houses, etc., etc. They must 
also sell portions of the land here and there at low rates. 
They are after gain, and in the end they usually get it. 
Nevertheless, poor people are aided in getting homes and 
share the profits resulting from the increasing value of all 
the property. 

134 



THE LABORER AND THE CAPITALIST. 

But, it may be asked — what about interest on money ? 
Does not that lodge the earnings of the many in the 
pockets of a few ? Does not interest concentrate wealth ? 

A very argumentative book on the subject of capital and 
labor was written by Edward Kellogg, revised by his daugh- 
ter, and published by Lovell & Co. in 1883. On page 189 
appears the following : 

'^In all ages and nations the rates of interest maintained have 
been so high as continually to concentrate the wealth in a few 
hands." 

On page 187 I find as follows : 
"Although the rates of interest in all old countries are much 
lower than in new countries, yet they are sufficiently high continu- 
ally to centralize the wealth and to increase more and more the 
number of the poor." 

On page 189 the author says : 
*'When the wealth of a nation becomes thus centralized the pro- 
ducers and distributers who are destitute of property are compelled 
to borrow. Etc." 

The opinion of this author regarding the effect of interest 
is being shared more and more every year by the populace 
and by writers as well. Mr. Kellogg does not advocate 
the abolition of interest entirely, as many do, only a reduc- 
tion of the rates to one or two per cent. 

I once beheved in this theory, and advocated it to the 
best of my ability. In fact, my effort to so master the 
philosophy that I could present it in a way to make it irre- 
sistible was precisely what led me to the discovery of its fal- 
lacy. Let us place Mr. Kellogg's arguments under scrutiny. 

135 



THE LABORER AND THE CAPITALIST. 

In the first place, when he assumes that those " without 
property are forced to borrow/' he overlooks the fact that 
people without property could not borrow if they would. 
Only those with sound property security can borrow money 
to any considerable extent. Usually real estate security is 
required. You might stand in a New York city bank, for 
example, for a whole month, and you would not see a sin- 
gle poor man come to borrow money. It is safe to say that 
90 percent, of all the money borrowed is by men of large 
means. The borrower must be understood to possess sub- 
stantial property or he will not be granted a loan of any 
considerable amount. 

Therefore, if interest hurts the borrower, the rule will 
be that those are hurt who are best able to stand it. 

But the question may be asked : " Do not those borrow- 
ing money to use in business add the interest to the price of 
whatever they sell, and in this way shift the burden from 
their own shoulders to the shoulders of others ? " Others, 
of course, means labor. Right here, many think they see 
interest robbing labor and centralizing wealth. 

If this theory be correct, that is, if those who borrow 
compel others to pay the interest, of course the borrowers 
get the use of this money without cost to themselves. 
Therefore, interest does not hurt the borrowers — only those 
who are not borrowers. 

Already, we begin to see something wonderfully incon- 
sistent in popular logic regarding this matter of shifting 
the burden of interest. 

If one class of borrowers can shift the burden of interest, 

136 



THE LABORER AND THE CAPITALIST. 

another can. As it is with the merchant and manufacturer, 
so it is with the farmer. Why, therefore, should any of 
these borrowers concern themselves about the rate of 
interest, since somebody else has to pay it ? 

Let us test this theory of burden shifting. CapitaHsts 
engaged in farming, mining, etc., produce what is called 
raw material, all of which is sold to the manufacturer. 
Suppose this class of capitalists to hire money : add the in- 
terest to the selling price of their raw material, and the 
manufacturing capitalists pay it. So far, the producers 
of raw material appear to have shifted the burden of 
interest to the shoulders of the manufacturers. But it so 
happens that these producers of raw material buy this 
same product right back again in the shape of manufac- 
tured goods. The manufacturers, of course, add the 
amount of their interest to the selling price of their goods 
and the producers of raw material pay it. Now the burden 
of interest appears to have come back to the producers of 
raw material. If this be true, then as often as the manu- 
facturer of goods and the producer of raw material ex- 
change products, which is once a year, to the full extent of 
aU they have to spare, just so often the burden of interest 
is shifted from one to another, back and forth, back and 
forth. 

Therefore, the burden has not shifted at all, since it 
does not remain with either class. 

But, you may ask, " Do not all these capitalists charge 
this interest up to labor, and in this way compel labor to 
bear the burden of interest?" Let us see. 

137 



THE LABORER AND THE CAPITALIST. 

If the wage-earner pays interest, the capitalists pay him 
the wages that pay that interest, which is the very money 
the wage-earner would otherwise use to purchase goods of 
the capitalist. 

How, therefore, can it help capital to charge interest up 
to labor, since the more interest labor pays, the less goods 
it can buy of capital. It would be just as impossible for 
capitalists to benefit themselves by beating and murdering 
the people, as by throwing a burden upon labor. Every 
blow dealt injures a customer; every person killed loses 
them a patron. 

A careful analysis of the subject wiU reveal the fact to 
the humblest understanding, that if interest were a burden 
added to the selhng price of goods, everybody would be 
obliged to bear a share, since everybody is obliged to buy 
goods. 

Men will not (barring rare exceptions) borrow money ex- 
cept they see an opportunity to reaHze more from it 
than they promise to pay for the use of it. Or, to state 
the same principle in another way, the loaner cannot, as a 
rule, find a market for his money at a rate of interest that 
will not allow the borrower to realize a profit from the use 
of it. 

The interest of no business is more closely related to 
the interests of the people than that of the money loaner. 
No sooner does the price of conmiodities fall than 
rates of interest fall. When prices rise, interest rises. 
When business stagnates the people use less currency 
and the money flows back to the banks, where it lies 

138 



THE LABORER AND THE CAPITALIST. 

unused, yielding the banker no profit. Money loaners 
have no power to strike the people a blow that will not 
react upon themselves. 

. However, at the beginning of the preceding chapter 
it was asked, "Has wealth concentrated?" The ques- 
tion is not yet answered. I have been considering the 
different methods and systems which are supposed to 
concentrate wealth. But so far none has been discov- 
ered that appears to lead to that result. The facts 
relied upon to establish beyond all cavil the theory 
that wealth has concentrated and is still concentrating 
are the government statistics referred to in the speech 
of Mr. Wilson in reply to Mr. Reed (both gentlemen 
quoted in the chapter entitled "Growth and Argu- 
ments of Socialism"). I will requote Mr. Wilson as 
follows : 

"March 10, 1850, Daniel Webster said that five-sixths of the 
property of the North belonged to the workingmen of the North. 
Can any representative from the commonwealth of Massachusetts 
make such a glorious boast to-day?" 

Mr. Wilson then referred to the census report, as you 
will remember, and asked that every citizen pause and pon- 
der, as to whether it indicated a growing prosperity or a 
dangerous decadence, and then said : 

" It appears in that report that of all the men occupying farms 
in this country to-day one-third of them are tenants, living on 
farms of others. It appears that of all the people occupying 
homes, other than farms, two-thirds live in rented houses." 

139 



THE LABORER AND THE CAPITALIST. 

These statistics are quoted everywhere, by the sin- 
cerest of people as well as by the wily politician. They 
are made to tell fearfully against the present regime. 
The fact that the figures are not of partisan origin, 
but government statistics, gives them great convincing 
power. I realize their force all the more because I 
was once influenced by them. 

Now, suppose these statistics to be correct (and there 
can be no doubt of it), how much do they mean in the 
present case? 

Do I exaggerate when I say that, with the tremen- 
dous immigration to this country, the number of home- 
less and farmless has been increased at least two hundred 
per cent, beyond what it would have been without immi- 
gration ? 

Of what value, then, are statistics showing that a 
larger percentage of our people are living on rented 
farms and in tenement houses, etc., at the present time, 
than in 1850? No rational division of profits could have 
made it otherwise. 

Poor people have come here from other countries without 
shelter until they have packed to overflowing the tenement 
houses in the lower wards of nearly every city in the 
Union. They have come landless, and hired farms, more 
than a million. They have filled our factories and manned 
our railroads and ships, until American workmen and wage- 
earners are becoming the exception instead of the rule as 
forty-five years ago. 

Now, if reliable figures can be produced showing that 

140 



THE LABORER AND THE CAPITALIST. 

native Americans — that is, those who wrought before the 
period of rapid immigration commenced — do not as gener- 
ally own property and as much of it as they did in 1850, 
then it will be time to inquire whether it is due to concen- 
tration of wealth or to some other cause. 

But this cannot be done; such figures do not exist. 
Therefore the statistics quoted by Mr. Wilson have not 
the slightest meaning in reference to the concentration 
of wealth. They indicate nothing, except the effect of 
immigration. And I have investigated the subject suffi- 
ciently to feel assured, that when the searchKght of 
public scrutiny is turned full upon the proposition under 
discussion, it will be found that if a reasonable allow- 
ance is made for the influx of poor foreigners, it will 
turn out that our people are more generally property 
owners than they were forty-five years ago, when the 
great Massachusetts Senator made his glorious boast. 
How can it be otherwise, when the average rate of 
wages paid to the individual laborer will purchase nearly, 
and in most cases a hundred per cent, more property 
than it would at that time? 



CHAPTER XV. 

THE BLAMED AND THE PITIED. 

I find the following in the New York Press (before 
quoted), June 28, 1894: 

141 



THE LABORER AND THE CAPITALIST. 

'^Albany, June 27. — " The anarchy of capital is abo\3 and beyond 
the law, and it seems to be the tendency of courts and legislatures 
to cater to the power of wealth and to the detriment of the wealth- 
maker, the workingman. The uncertainty of court decisions has 
always been to the detriment of the people. We do not want to 
see the laboring man gaUed to desperation, leaving the paths of 
law and taking justice in his own hands. But it will come to 
that. We don't want to have it come to that pass that men will 
have to go about protected by a bodyguard. We are for evolution 
rather than revolution, but if the first cannot come the second will. 
We are not conspirators. We are law-abiding citizens. We do 
not want to strike, but he who would not strike, when the bread 
and butter of his family are at stake, is not a man, but a coward." 

''Thus" spoke Samuel Gompers, President of the American Federa- 
tion of Labor, to-night before the joint committees on prisons and 
industries of the Constitutional Convention. It was a speech that 
bordered on socialism and anarchism." 

The Evening Post, June 27, 1894, had the following : 

*^As the world now stands, we hold it to be the solemn duty of 
all writers, preachers, professors, who are engaged in the work of 
reform, to refrain from denunciations of the existing society and 
social arrangements. Reform is possible without this, by simply 
acting on the lines of human nature. The common practice among 
Christian and other Socialists and Utopians of abusing nearly 
everybody who succeeds in life as an enemy of the human race, and 
the existing constitution of society as an engine of fraud and op- 
pression, has undoubtedly done much to produce the " militant 
Anarchist," and give a sort of moral justification to his attacks on 
life and property." 

The* Morning Advertiser quoted the foregoing para- 
graph from the Post and then commented as follows : 

145i 



THE LABORER AND THE CAPITALIST. 

'*This is nothing less than an appeal to all varieties of snarling 
and hare-brained economic fault-finders, Mugwumps included, to 
become sane and rational/' 

In the same article the Advertiser quoted President 
Cleveland as follows : 

"But the communism of combined wealth and capital, the out- 
growth of overweening cupidity and selfishness, which insidiously 
undermines the justice and integrity of free institutions, is not 
less dangerous than the communism of oppressed poverty and toil, 
which, exasperated by injustice and discontent, attacks with wild 
disorder the citadel of rule." 

The Advertiser followed this statement of President 
Cleveland's with these comments : 

**This is not the language of Herr Most, or Justus Schwab, or 
Waite of Colorado, or even of that piebald political freak, Tom 
Johnson of Ohio. It is an extract from a message sent to Con- 
gress in December, 1888, by Grover Cleveland, then, as now, 
President of the United States. Does not the JPost feel inclined 
to smile at the feebleness of its proposed remedy ? Has any dem- 
agogue among us done more to widen the gulf between the rich 
and the poor than its friend in the White House?'' 

*Tf we are hard upon an era of anarchy and bloodshed, Grover 
Cleveland cannot skulk out of his share of responsibility in bring- 
ing it about. Nor will the people permit him to do so." 

I do not think that, as a rule, people are inclined to 
blame where it is not deserved, but one's faith in the wis- 
dom of his own course often makes him a little hasty in his 
conclusions regarding the course of others. 

143 



THE LABORER AND THE CAPITALIST. 

Suppose one were to reply to the Advertiser, as they 
might, with quotations just as strong from prominent Re- 
publicans as it has quoted from Democratic sources. Quote, 
say, the celebrated remark of Garfield, substantially as follows: 
**The barons of the middle ages were not more powerful and 
tyrannical than the rich men and corporations of the United States 
at the present time/' 

Or the statement of Judge David Davis of Illinois, so 
often quoted, that he looked forward with anxiety to the 
coming struggle between the people and overgrown monop- 
olies. President Lincoln declared that had it not been for 
labor capital would not have existed, " therefore labor de- 
served much the higher consideration." 

I have referred to these statements near the close of mv 

</ 

essay for the purpose of bringing before the reader's 
mind again, and as vividly as possible, the important fact 
previously set forth, to wit: That the complaint against 
existing conditions was confined to neither party, nor 
creed, nor demagogue, my object being to show the magni- 
tude and seriousness of the question we have in hand, 
which is apparent from the character of many of those 
who have done and are now doing so much to set the 
people thinking upon the capital and labor question. The 
day is one of tumult and controversy, and the need of the 
hour is that capital and labor shall come together and each 
have a fair hearing at the judgment seat of the other. 
Both have grievances that can be settled only by arbitra- 
tion, and the arbitrating committees must always be those 
who are aggrieved. Outsiders cannot arbitrate for capital 

144 



THE LABORER AND THE CAPITALIST. 

and labor, for the all-suf&cient reason that everybody is 
either a laborer or a capitalist (and ninety-five one-hun- 
dredths of our people are both) and every dispute in- 
volves a principle that interests the whole. This means 
that the community at large, the capitalist and the laborer, 
must study economics, each in his own mind, as they exist 
now and here. The one way out of the confusion and 
contradiction in which the world is now wandering is for 
people to stop and think. 

No general and well-directed effort has been made to 
institute a sober discussion of the relations of capital and 
labor with a view to bringing the question home to every 
mind. What have I to do with this matter, and how 
far is my present opinion the result of my own disinterested 
inquiry, and how far is it the result of hearsay evidence, 
which may or may not have a scientific basis ? 

But, you say, we busy and comparatively uneducated 
people cannot solve the mighty social and political prob- 
lems that now confront the world. They puzzle even the 
scholar, the statesman, and the philosopher. 

It is true that scholars, statesmen, and philosophers differ 
as widely as the masses, and the leaders of labor are dis- 
puting among themselves, and so are the leaders of capital. 
What is left for you and for me, then, but to make diligent 
and careful research, and follow our own reason? If this 
course does not enable us to solve the whole problem, it 
will certainly lead to more light ; it will help us to settle 
upon some things as true or false which we are now in 
doubt about. 

145 



THE LABORER AND THE CAPITALIST. 

The great and good Lincoln thought that labor deserved 
more consideration than capital, and the world is with him. 
But suppose the distinguished martyr were upon the earth 
in these troublous times, and that he had authority to send 
you forth to pour oil upon the troubled waters, and he 
should tell you to go and counsel with capital and labor 
and use your best efforts to have them come together and 
effect an amicable settlement of their differences, but that 
you should always bear in mind that labor deserves much 
the higher consideration. Now, it occurs to you that in 
your journeyings you may be asked why it is that labor de- 
serves a higher consideration than capital, and you put the 
question to Mr. Lincoln : " Why does labor deserve a 
higher consideration than capital?" 

He answers that the reason is fundamental. That is, 
labor is the father of capital. In other words, capital owes 
its existence to labor. Therefore, labor deserves the higher 
consideration. 

This may satisfy you for the moment, but if you take 
time to analyze the proposition, you will discover that if 
labor deserves the higher consideration because it produced 
capital, then the father deserves a higher consideration 
than the son, the caterpillar than the butterfly, the cloud 
than the rain, since the latter could not have existed if the 
former had not first existed. 

By this time you will begin to conclude that priority of 
existence, or the fact of one being the producer, and the 
other the thing produced, has very httle to do with the 
consideration that belongs to either. However, the behef 

146 



THE LABORER AND THE CAPITALIST. 

that labor deserves a higher consideration than capital, is 
old, widespread, and deep-rooted, and nothing short of 
absolute proof to the contrary can change that belief. 
Very well, try the question in the light of your own experi- 
ence. 

You worked and earned fifty dollars ; therefore, your labor 
created fifty dollars of capital. You then paid the fifty 
dollars out for labor ; that is, you employed fifty dollars' 
worth of labor that would not have been employed had you 
kept your fifty dollars in pocket. Why, then, is it not as 
correct to say that capital creates labor, as it is to say that 
labor creates capital, since the labor would not have been 
employed without the use of the fifty dollars or its equiva- 
lent in some other kind of capital ? 

The principle here involved is illustrated in what is 
called the game of " teetering," such as most of us enjoyed 
in our boyhood. A board or plank is placed across the 
fence, and a boy gets upon either end. One presses his 
feet upon the ground, and sends himself into the air ; then 
the other does the same, and the result is a pleasant motion, 
and an enjoyable season for both. But a dispute arises as 
to which deserves the most praise for all this. One boy 
says : " I deserve the most praise for the reason that I 
kicked the ground first and set the whole thing in motion." 

" How is that," says the other boy. " If you kicked the 
ground first at one movement, I kicked it first the next, and 
during the hour we teetered, I set the thing in motion as 
many times as you did, and, really, I do not see that either 
of us deserves any very great praise, since both worked for 

147 



THE LABORER AND THE CAPITALIST. 

our own happiness, but owing to a natural law, which we 
did not create, each was obliged to give the other a bound 
upward in order to get one for himself." 

This illustrates the relationship of capital and labor. One 
cannot teeter unless the other teeters at the same time, and 
not one whit more of consideration belongs to one than be- 
longs to the other. 

But, you say, the laborer is weak, the capitalist is strong, 
and to help the weak is our first duty. 

Very well, I am discussing capital and labor as economic 
principles; and I would not knowingly say that which 
would tend to lessen pubKc sympathy for the poor. I com- 
mend a statement by Abraham Hewitt as appropriate to 
the present time and condition. In the New York Herald, 
September 24, 1893, Mr. Hewitt is reported as follows ; 

^^Now as to these very rich men, and as to this very poor class, 
this wretchedly poor stratum, is there not a duty, is there nothing 
indicated by such a picture as I have suggested of this fringe 
at the top of the social sphere — this fringe of social wealth and 
this stratum of poverty, of want, of utter helplessness at the 
bottom ? 

"Yes, it is an ethical question; it is a moral question; it is a 
question of conscience ; it is a question of religion. These very 
rich men have duties. This poor and hopeless seething mass at 
the bottom have rights, and the rich man who is not busy thinking 
how he may mitigate the sufferings of that mass at the bottom and 
how he may lift it, is unworthy of possession of the fortune which 
has been put in his hands whether by accident or industry." 

This sentiment is just, and will find an answering chord 

148 



THE LABORER AND THE CAPITALIST. 

in the bosom of the thoughtful and humane. It is a noble 
appeal from one of New York's richest men, in behalf of 
the suffering poor. But it is worth our while to see to it 
that we make no mistake as to who the greatest sufferers 
are ; for if we err in this, we are liable to overlook important 
duties and to be betrayed into a narrowness of view that 
will greatly interfere with our usefulness. 

0, well, you say, what is the use to talk about that ? Of 
course the greatest sufferers are those who work for insuf- 
ficient wages and those who are out of employment. 

I frankly admit that there are a great many sufferers 
among such as these, but are they as numerous as is gen- 
erally believed ? and are their sufferings more severe than 
those of any other class of our people ? 

The following, clipped from the Morning Press, Dec. 23^ 
1893, is to the point: 

"Chicago, Dec. 22.— Only about 450 out of 2,000 "hungry" 
men, who have been eating free soup at the Lake Side Kitchen for 
the last week, accepted the invitation given by the Central Relief 
Association yesterday to work on the streets long enough each 
day to pay for their subsistence. All the others sneaked away as 
soon as their soup-bowls were empty. When they returned last 
evening without tickets from the foreman of the street gang they 
were invited to seek their living elsewhere." 

One looking over that crowd of the two thousand people 
eating their soup at only one dispensing station, would have 
said : What a vast number of hungry people there must be 
in all this great city. But when the test was applied, 
however, it turned out that more than three-fourths of these 

149 



THE LABORER AND THE CAPITALIST. 

people had other resources. At any rate, their hunger was 
not so intense, but that they refused to earn food by 
working on the streets. Who doubts but that the same test 
applied to New York and other cities would have revealed 
about the same state of facts. 

I learn through the Rev. J. W. Wilds, pastor of the 
Seventh Presbyterian Church, corner of Ridge and Broome 
streets in New York, where the population is very dense, 
and where there is about as much poverty as any- 
where in the city, that the number of the really destitute is 
much less than the popular estimate. Our informant is 
very active in charitable work and knows whereof he affirms. 
He spoke of the discouraging effect, upon charitably dis- 
posed people, of the numberless cases where investigation 
had shown that the help asked for was not needed. 

However, there is much suffering in such localities that 
ought not be allowed to exist. There are ignorance and filth 
there that should not be allowed to continue. It is not bred 
in our country; it was imported. Not one in fifty of the 
destitute, or supposed destitute, upon whom the popular 
gaze is so fixed, were born in this country, and very rarely 
is one found who can speak English sufficiently well to be 
easily understood by one who has not lived among such 
people, or been in the habit of dealing with them. 

Nevertheless, those people are here, and when they need 
help it should be given none the less freely because they 
were not born in the United States. And I here take oc- 
casion to say that I respect neither the culture nor the hu- 
manity of people who do not feel the force of this truth. 

150 



THE LABORER AND THE CAPITALIST. 

I regard him as undeveloped, as not having grown to 
the stature of true manhood, whose sympathies cannot cross 
the threshold of any home, or fly beyond any sea, at the 
call of human suffering. And I am glad to be able to say, 
without fear of successful contradiction, that a prouder 
record was never made by any class of people than our 
wealthy citizens have made, and are making, by their gen- 
erous conduct toward the poor foreigners now living in 
American cities. Free lectures, free night schools, free 
kindergartens, free dispensaries are being planted, and 
rapidly, too, in the poorer districts. Indeed, these insti- 
tutions are being estabhshed as fast as the ignorant 
populace can be induced to patronize them. Most of 
these are supported by the donations of the rich. In- 
deed, I heard Dr. Coit, the founder of the " Neighbor- 
hood Guilds" in New York, say in a public speech, that 
he had never asked in vain for means to carry on his 
work of educating and bettering the condition of the 
poor in the great metropohs, but that he had always 
found her wealthy citizens willing to donate generously 
whenever and wherever it appeared plain that substantial 
good would result. 

What I have said with reference to foreigners, and 
concerning the unprincipled, who apply for aid when they 
have other resources, has not been to belittle the cause 
of the worthy poor among them, but I have taken this 
course that I might the more surely turn the reader's 
attention to another class of sufferers who are rarely 
noticed in the popular discussions of the capital and labor 

151 



THE LABORER AND THE CAPITALIST. 

question. I refer to capitalists who employ labor, 
business men who have started in the world with no 
better opportunities than those I have just discussed, 
but who, through self-denial, economy and diligence, have 
come to cut a figure in business circles, and then been 
reduced through losses and other misfortunes to poverty 
and humiliation. The following, from the Morning Press, 
January 14, 1894, is to the point : 

" In periods of great financial stringency the number of suicides 
always increases," said Dr. Tracy, the registrar of vital statistics 
of the Board of Health. " The details of the last quarter of 1893 
have not been tabulated yet and wiU not be for several weeks, 
but I think they will show that self-murder has increased until a 
record has been made which was never equaled in New York be- 
fore. 

This increase of suicides comes from the better class of people 
almost entirely. That is, from among those who are supposed to 
be pretty well situated in life, such as business men prominent in 
large concerns. Here is what a subordinate in the Health De- 
partment said on that point: 

" You will find if you read the last month's newspaper accounts 
of suicides that the greater portion of this winter's suicides does 
not come from the ranks of the desperately poor. In hard times 
it is the proud, self-respecting man, who would scorn to fail if he 
were in business, or accept charity if he has been an employee, 
that suffers in secret till he can bear it no longer and then picks 
up his pistol and blows out his brains. There never has been so 
many of these cases as in the past few months." 

I can add nothing to this statement that wiU increase its 
convincing power. It demonstrates with the certitude of 

162 



THE LABORER AND THE CAPITALIST. 

mathematics that in hard times the keenest of suffering is 
not always where the pubHe looks oftenest and pities 
most. 

The moral I would inculcate is not that the employee be 
less cared for^ but that it be not forgotten that the inter- 
ests of the employer and the employee are one, and that 
when we find the wage-earners in trouble it is often because 
the wage-payers are in sorrow. Let us be just to all, and 
take good care lest we cast blame where it does not belong. 



CHAPTER XVI. 

THE BLAMED AND THE PITIED (CONTINUED). 

The result of thoughtlessly and innocently casting blame 
where it does not belong, or, perhaps, I had better say, 
failing to include all the blameworthy, is most disastrous 
to the cause of good feeling and stable government. 

Very little is being written upon the social and economic 
problem that does not either directly or indirectly, or by 
inference, cast most of the blame upon the rich for what- 
ever is hard in the conditions of life. 

The Labor Leader, January 6, 1892, copied from 
Harper's Weekly the following : 

IN THE TENEMENTS. 

^'Roughly speaking, there are 10,000 tenement houses in New 
York City, and of these about 500 are very bad, and should be 
and must be pulled down. One of the troubles with tenement- 

153 



THE LABORER AND THE CAPITALIST. 

house property is, it is good property for tke landlord. It yields 
immense returns, and the landlord who is content to take 4 per 
cent, for his money instead of 12, and by so doing give a chance 
to his poorer brother to live as well as exist, while he is present 
with us, is still rare. Some readers of Harj)er''s may be startled 
to know that even on poor streets east of the Bowery floor space 
is worth double what it is in such apartments as the " Dalhousie " 
overlooking the Park, and if, instead of measuring the floors, you 
took the cubic contents of the rooms in these quarters, and in such 
splendid flats as this to which I have referred, a cubic foot of 
space is worth in these hovels nearly three times what it is in those 
overlooking the Park. 

"How can the poor head of a family, an unskilled laborer, or, for 
that matter, even the poorly paid skilled laborer, whose wages do 
not average the year round more than eight to tv/elve dollars a 
week, how can he afford to pay for space enough in which to bring 
up his children in necessary decency ? 

''One thing seems certain, if the children of the city are to be 
saved from vice, their environment must be improved." 

This contribution to Harper's Weekly is from the pen 
of Dr. Rainsford, one of the deservedly popular preachers 
of New York, a fair minded and capable gentleman. 

I believe in publishing far and wide everything that is 
calculated to let all humanity know how each part is 
situated, and how the whole is affected by each part. But, 
in my judgment, this article by Dr. Rainsf ord, if not too 
strong against the landlord, fails to state the other side of 
the question as fully as it ought. 

The first proposition, briefly stated, is this : Tenement 
houses yield immense return s, and landlords ought to be 

154 



THE LABORER AND THE CAPITALIST. 

content to receive 4 per cent, on tlieir investment instead 
of 12. 

The readers of Harper^ s Weekly^ and the readers of the 
Labor Leader, will multiply this statement a thousand 
times, and it will intensify the impression already wide- 
spread, that landlords are receiving about 12 per cent, net 
on money invested in tenement-house property ; while the 
actual truth is, when water rents, taxes, vacant rooms and 
repairs are taken into account, the profit accruing to the 
landlord does not reach an average of 6 per cent. 

Think a moment. How long would it require capital to 
cover the continent with tenement houses, could they real- 
ize a profit of 12 per cent, on their investment ? It is 
hardly necessary to repeat what has been before stated in 
substance, to wit, that the very avarice of capital will not 
permit investment in any one direction to yield a profit 
larger than ordinary for any great length of time. Would 
intelligent bankers, for example, be found loaning their 
money for from 2 to 6 per cent, as they are doing, if they 
could realize 12 per cent, by investing in tenement-house 
property ? 

The gist of the second proposition in Dr. RaiDsford's 
article is that the poorer people east of the Bowery are 
obliged to pay very much more per foot for room in those un- 
comfortable houses than is charged in the splendid flats 
overlooking the Park. This is true, but what of it ? Does 
it f oUov/ that the rich are to blame as will naturally be in- 
ferred from the writer's statement ? Not at all ; the smaller 
but very comfortable flats in the vicinity of the Park, and 

155 



THE LABORER AND THE CAPITALIST. 

there are many of tliem (three and four rooms), are let at 
a lower rate than those east of the Bowery. Why don't 
the Bowery people move up there ? 

Again, all around those tenement houses east of the 
Bowery, and indeed the first story of many if not most of 
them, is occupied for business purposes by men who cannot 
be counted poor ; some of them are rich. They, too, have 
to pay a higher price per square foot for room than those 
who occupy business houses near the Park. Therefore, 
rich and poor stand upon the same footing in this matter 
of higher rent east of the Bowery, and lower rent in the 
vicinity of the Park. 

A higher price is charged for room near the Bowery, be- 
cause the location is nearer the business center. But, mark 
you, all this talk about discriminating against the helpless 
poor east of the Bowery and through that part of the city 
is not without some reason. There is discrimination in 
those localities, and sweatshops are there also. That is, 
places where people are forced to work for wages cruelly 
low and pay rents enormously high. Most of it comes in 
this way : 

Poor foreigners who are accustomed to work on 
clothing, for example, and who cannot speak English, 
are met on their arrival in this country by better 
informed foreigners, and are engaged by them at wages 
far below the average rate usually paid for such work in the 
United States. These employers hire tenements and sub-let 
them to their more ignorant brothers at enormous prices, 
sometimes crowding a large family into a single room. The 

156 



THE LABORER AND THE CAPITALIST. 

newcomer cannot speak English, therefore he cannot go 
out among Americans to look for work, so there he stays 
and sweats. I heard Mr. Cohn, a Socialist editor in New 
York, relate these facts in a public speech. Seth Low, the 
philanthropist and distinguished President of Columbia 
College, was present at the time and made some remarks, 
declaring his willingness to do all in his power to remedy 
the evil. Mr. Low is rich. 

I will state the next proposition in Dr. Kainsford's own 
language, as follows : 

'*One thing seems certain ; if the children of the city are to be 
saved from vice, their environment must be improved." 

Every conscientious well-wisher of the human kind will 
agree with Dr. Eainsford that the surroundings of the 
poor tenants of New York, and, indeed, everywhere for 
that matter, ought to be improved. But why not state 
the fact that they are being improved, and why not let 
the world know who are most active and powerful in mak- 
ing the improvements ? Who but the rich furnished the 
means to carry out Felix Adler's plan for improving ten- 
ement houses ? 

The Constitution Club of New York was brought into 
existence by rich men ; the Thurbers and other millionaires 
were among its founders. This club has taken great pains 
to send physicians and others through the tenement houses 
of New York for the purpose of ascertaining the real con- 
dition of the inmates, etc. Other institutions, mainly un- 
der the control of the rich, have done the same. The 
facts have been laid before the representatives of the 

157 



THE LABORER AND THE CAPITALIST, 

people, and legislation asked for. The result is that the 
building of tenement houses not well lighted, not well ven- 
tilated, and not provided with improved modern sanitary 
arrangementSjis forbidden by statute law. 

However, the one error in Dr. Kainsford's article capa- 
ble of more mischief than all the rest is a very common 
one. It is entertained not more generally by the ignorant 
than by people who, like Dr. Eainsford, are exceptionally 
intelligent and well educated. The error to which I refer 
is stated in the following words : 
*^One of the troubles with tenement-house property is it is good 
property for the landlord." 

This statement involves the popular error which is at 
the bottom of much of the present strife between capital 
and labor, to wit : that large profits can come to the world 
of capital without bringing corresponding benefits to the 
world of labor. If Dr. Rainsford had used the word bless- 
ing instead of trouble, that is^ if, instead of saying " the 
trouble is that tenement-house property is good prop- 
erty for landlords," he had said "the blessing is that tene- 
ment-house property is good property for landlords," he 
would have stated a grand economic principle. 

To illustrate : An association owning land in the neigh- 
borhood of 116th street, New York City, voluntarily built 
an elevator for the ele\^ated railroad at that station. This 
land is situated in one of the finest portions of the great 
metropolis, near Morningside Park, Central Park, and River- 
side Park. 

The land association beHeved that an elevator at 116th 

158 



THE LABORER AND THE CAPITALIST. 

street would be an inducement for capitalists to build 
costly dwellings and reside there. But, owing to the fact 
that tenement-house property is profitable for the land- 
lord, capital has covered this land, and hundreds of acres 
of other land in that locality, with beautifully finished flats 
of all sizes, into which tens of thousands of the poor and 
those of moderate means have moved. 

In short, because tenement house property is good prop- 
erty for the landlord, the poor people are coming to rejoice 
in better homes and finer locations. 

I do not say that the wages received by the people referred 
to by Dr. Rainsf ord are as high as I wish they were ; 
neither do I feel that these people can afford to hire all the 
room they ought to have in which to rear their families ; 
but the encouraoi-ing" fact ous^lit to be stated in the same 
connection, that the wages mentioned by Dr. Rainsf ord are 
from 50 to 100 per cent, higher, and will purchase at least 
that much more of the necessaries of life, and procure that 
much more room for family purposes than they would fifty 
or even thirty years ago. This shows a progress which no 
other period of history of equal length can duplicate ; and 
all this has taken place while large fortunes have been 
accumulating. 

But, you will say, the fact remains that the situation of 
these people is still far from satisfactory. This is a truth 
which ought to be stated and discussed everywhere, and the 
blame made to rest where it belongs. 

The following figures, copied from a kindergarten text- 
book, which claims to have taken them from the Census 

159 



THE LABORER AND THE CAPITALIST. 



Keport of 1880, are of great importance to the subject of 
poverty and destitution : 

*'Cost of liquor, . . . 1900,000,000 

Grist-mill products, . . . 505,000,000 

School property, . . . 211,000,000 

Men's clothing, . . . 209,000,000 

Woolen goods, . . . 160,000,000 

Expense of public schools, . . 79,000,000 

Agricultural implements, . 68,000,000 

Bakery products, . . . 65,000,000 

Confectionery, . . . 25,000,000 

Toys, 1,000,000^^ 

Dr. Strong, before quoted, has placed the cost of liquor 
consumed in the United States in 1890 at over a billion 
dollars. That the rich use much more of this com- 
modity than they really need, there can be no question; 
but if they were to drink all they could, and, I had almost 
said, use it for bathing purposes as freely as they now 
use water, they could not appropriate one-tenth part of 
the liquor that is consumed in the United States. It 
is safe to say that at least $800,000,000 is annually spent 
by the poor people for intoxicating drink, say $700,000,000 
more than can possibly be good for them. This is more 
than double what they spend for clothing, or for schools, or 
for bread, and much more than they spend for rent. 

This money, saved and put at interest at 6 per cent, for 
twenty years, would purchase every farm m the United 
States. It would build houses sufficient to shelter all the 
people of the country, independent of the rich landlords 



IGO 



THE LABORER AND THE CAPITALIST. 

who are now accused of oppression. It would purchase all 
the large factories in the United States. In short, it would 
drive destitution from the land. 

Now, if the rich do not do as much for the poor as they 
ought, do the poor do as much for themselves as they 
might f 

The Eev. Thomas Dixon, before quoted, complained that 
the rich were airing their poodle dogs and amusing them- 
selves on Fifth avenue, while the people were unemployed 
and hungry at the other end of the city. This was true. 
But why not mention another fact just as important, to 
wit: The poor were airing their dogs at the same time 
(they are quite as likely to keep dogs as the rich) and the 
theaters in the Bowery and on Third avenue were filled to 
overflowing with laboring people, while their brothers were 
unemployed and hungry all about them. 

Not long since I was standing on a street corner in Orange, 
N. J. Near me were gathered a number of unemployed 
men, and their look was downcast. A coach passed by 
filled with laboring men and women. The songs they 
were singing told that they were happy ; indeed , some of 
them were hilarious. They had been to the Orange Moun- 
tains for an outing. They needed it, God bless them ! But 
they heeded not those on the street corner, who lacked the 
money to defray the expense of such a trip. 

It is not an uncommon thing to see the rich on their way 
to spend their dollars for that which can do them only 
harm, instead of using it to help the needy ; but along the 
same thoroughfare travels the poor man to spend his dimes 

161 



THE LABORER AND THE CAPITALIST. 

in the same selfish manner, though his brother hunger for 
bread. Whoever will give this subject the attention it de- 
serves will discover that whatever blame there is for the 
hard conditions that environ human life, attaches as 
much to the poor as it does to the rich, to the laborer as 
much as to the capitalist. 



ie^ 



THE LABORER AND THE CAPITALIST. 



PART 11. 

CHAPTER I. 

CHILD-LABOR Al^D HOME-OWNERS. 

Since the foregoing chapters were written my attention 
has been called to a particular portion of Dr. Strong's trea- 
tise (before quoted) as containing irrefragable statistical ar- 
guments against the theory promulgated in this work re- 
garding the condition and prospects of the masses under 
the existing economic regime. The proposition by Dr. 
Strong appears on page 147 of his work as follows : 

"In Massachusetts, where statistics of labor are the most elabo- 
rate published, the average workingman is unable to support the 
average workingman's family. In 1883 the average expenses of 
workingmen's families in that State were $754.42, while the earn- 
ings of workmen who were heads of families averaged $558.68. 
This means that the average workingman had to call on his wife 
and children to assist in earning their support. We accordingly 
find that in the manufactures and mechanical industries of the 
State in 1883 there were engaged 28,714 children under sixteen 
years of age. Of the average workingman's family 32.44 per 
cent, of the support fell upon the children and mother. I am not 
aware that the condition of workingmen is at all exceptional in 
Massachusetts." 

My attention has also been called to this further propo- 
sition, same work, page 153 : 
**We have already seen that the average workingman in Massa- 

163 



THE LABORER AND THE CAPITALIST. 

chusetts aiid Illinois is unable to support his family. At that 
rate how long will it take him to become the owner of a home? 
Of males engaged in the industries of Massachusetts in 1875, only 
one in one hundred owned a house. When a workingman is un- 
able to earn a home, or to lay by something for old age, when 
sickness or the closing of factories for a few weeks mean debt, is 
it strange that he becomes discontented ?^' 

These propositions differ from those previously quoted 
from Dr. Strong and others holding substantially the same 
views on the capital and labor question only in that they 
refer specifically to the emplojrment of women and children 
in factories as indicating a deplorable and discouraging 
condition of the masses in Massachusetts and throughout 
the country. 

Dr. Strong's inferences are drawn from figures which 
appear to show that 32.44 per cent, of the support of work- 
ingmen's families is furnished by members other than the 
male head, and that 28,000 children under sixteen years of 
age are employed in the manufactures and mechanical in- 
dustries of Massachusetts, and also that only one in one 
hundred of the males in her industries owns a house. 

Twenty-eight thousand are a great many children to be 
employed in the factories and mechanical industries of a 
sino^le State at so tender an asre. 

Take notice, however, on pages 180-181 of his work 
Dr. Strong says : 

"A census of Massachusetts, taken in 1885, showed that in 65 
towns and cities of the State 61.1 per cent, of the population was 
foreign by birth or parentage. ^' 

164 



THE LABORER AND THE CAPITALIST. 

This is an important element in the problem of child- 
labor. Most of the manufacturing is carried on in towns 
and cities where the foreign element predominates, and it 
is safe to assume that of the 28,000 children under 16 
years of age employed in the factories and mechanical 
industries of Massachusetts in 1883, at least 90 per cent, 
were colored or of foreign birth or parentage; and the 
same is undoubtedly true in the factories throughout the 
United States. 

It is not to the discredit of these colored people and 
foreigners that they work in factories. Great numbers of 
the noble sons and daughters of New England had worked 
there before the present occupants came, and they worked 
more hours for less pay. By this it is not intended to deny 
the fact that many children are employed in factories 
and in the mechanical industries of Massachusetts and 
other States who ought to be in school. Parents are too 
often forgetful of their duty to children in this respect, and 
manufacturers are not spotless above other people. Then, 
too, many families are in a measure dependent upon the 
efforts of their children for support, not only in the manu- 
facturing and mechanical industries, but in all industries. 
This is the case now ; it always has been the case ; it is not 
necessarily due to low wages however. The too large 
increase in the membership of families through the birth of 
children, often causes an abnormal increase in living 
expenses, which in many cases becomes more than the male 
head can meet, and then other members of the family are 
called upon for assistance. 

165 



THE LABORER AND THE CAPITALIST. 

Just how often this proves to be against the interest of 
the children so born, it is not easy to determine. Certain 
it is, however, that FrankUn, Webster, Greeley, Lincoln, 
and indeed thousands whose names bloom in history and 
who have stamped their thought upon the age in which 
they lived, were early thrown upon the world, not only to 
support themselves, but were compelled to contribute to the 
support of parents and younger brothers and sisters. And 
it may be added, that scarcely a man of such experience 
has been known who did not in his mature years, rejoice 
that poverty had been the lot of his boyhood, and that his 
daily bread had been earned by hard work, born of 
necessity. 

Valuable data appear in an article in The Arena, June, 
1894, by Alzina Parsons Stevens, Assistant Factory In- 
spector for Illinois, as follows : 

'^February, 1894, the total number of children examined in the 
Inspector's office was 46. In answer to the question: "What is 
your father's occupation?" in 15 cases the reply set down was, 
"Out of work." To the question: "Is your father living or 
dead?" the answer in 6 cases was, "Dead." 

"Here were 21 families out of 46 without the natural bread win- 
ner. In only one instance was the child the only one in the fam- 
ily; but in 16 cases the child was the only member of the fam- 
ily at work. In 18 cases the number of members in the family? 
parent or parents included, was 6 or more than 6. The highest 
number was a family of 16 persons, for whom one 14-year-oId 
girl is at present the only provider. The nativity of these children 
is divided as follows: Born in the United States, 11, all of for- 
eign parents; in Germany, 10; in Poland, 9; in Bohemia, 9$ in 

166 



' THE LABORER AND THE CAPITALIST. 

Russia, 4 ; in Hungary, Austria, and Canada, 1 each. Twelve 
of the children spoke very broken English, or none at all. Of the 
entire 46, only 3 were found in really normal condition." 

Take notice : Every child examined by the factory in- 
spectors of Illinois in February, ISM, was a foreigner by 
birth or parentage, but few could speak good English, 
and some of them none at all. In 18 cases the number of 
members in the family was 6 or more, 16 being the high- 
est. Has it been shown, can it be shown, that the afore- 
said children would be better off without factory employ- 
ment than they are with it ? Would their physical health 
be better cared for? Would their moral training be bet- 
ter? In short, would the temptation to indulgences that 
weaken both body and mind be lessened by closing the f ac - 
tories against them ? What would be their occupation and 
teaching at home and in the streets during the hours they 
are now employed in the factories? All these questions 
have to do with the problem of child-labor. 

In the same article in The Arena are found answers by 
teachers touching the question of the employment of chil- 
dren in factories. Of the effect one teacher says : 

*^Most pernicious. Most children at an early age are hardened. 
And yet the home influence is terrible to contempla.te. They are 
unfortunately handicapped from birth; the home pushes them 
dovvTi, the streets aid, and the mill adds its influence. It is a 
wonder if any are good.^^ 

These children are " handicapped from birth. The home 
pushes them down," says the teacher. Now, if the factory 
and street do not raise them, it does not follow that they 

167 



THE LABORER AND IHET CAPITALIST, 

would become more elevated without factory employment. 
The condition in which these children are found is very 
largely bred in foreign lands^ and must bear more or less 
fruit when transplanted to other soil^ be that soil ever so 
pure. 

It is wise and well to make all possible haste to eliminate 
the evils that attend the employment of children in facto- 
ries^ but let us be careful that we trace the wrong to the 
proper source and cast the blame where it belongs. 

American capital and avarice are popularly regarded as 
the wicked cause of most of the crooked spines, pallid coun- 
tenances and tattered garments found among children in 
our factories. What would be said of American capital 
should it refuse to employ these unfortunate children? 
"0 well/' you say, "let capital pay wages to the male 
adults sufScient to enable them to maintain and educate 
their families without making wage slaves of their wives 
and children." 

This is the popular demand ; but as a matter of fact, 
hovv^ far can wages be made to fit the case in question ? 
Here are the indigent families, very large in most cases, as 
has been shov/n, some numbering as high as sixteen ; if the 
male head is to be paid wages sufficient to support and 
educate all these, what will be the size of the pay-roll of 
the average manufacturer, and what price will he be 
obliged to put upon his goods in order to meet such an 
enormous" outlay ? And will the community be willing to 
bear the increased burden of higher prices, which such a 
proceeding would surely involve ? 

168 



THE LABORER AND THE CAPITALIST. 

This question readies beyond the manufacturer^ and the 
effect of higher wages circles right around to the laboring 
man in the greater cost of what he consumes. 

Again, if our economic system is to be adjusted with 
reference to the number of children parents may bring into 
the world, then the least educated of the colored people, 
and the most ig-norant of the foreigners, and those who are 
incompetent to perform any but the commonest kinds of 
work, but who outstrip all others in the production of 
children, will require wages far above the more intelligent, 
educated, and skilled artisans and clerks, etc., whose families 
are much smaller. 

Again, if wages ever so high were to be paid the people 
in question, would they use the money so received in the 
interest of education, of cleanhness, and of morahty ? It is 
plain that in this matter of overworked, immoral and un- 
educated children in factories, etc., we have a question, not 
so much of capital and labor, as of moral and religious 
teaching, of ethics, and, above all, of immigration. 

Of the whole number of children employed in the factories 
of Massachusetts, 6 per cent, are vrhite Americans, 16 per 
cent, are colored, and the balance, or 78 per cent., are 
foreign by bij?th or parentage. But after all, the whole 
number is insignificant when compared to the population of 
the State, and still more insignificant appears the number 
of factory-employed children when considered in relation to 
the population of the whole country. 

The census of 1890 places the whole number of children 
employed in the factories of the United States at 121,494, 

169 



THE LABORER AND THE CAPITALIST. 

which is less than one child to every 175 families. This 
does not sound so terrible for the young children of the 
country. Massachusetts being so exclusively a manufactur- 
ing State, her case is an exceptional one ; but, then, her 
factory-employed children number only one to every thirteen 
of her families. 

Regarding the treatment these children are receiving, 
Mrs. Kelly, prominently connected with reformatory move- 
ments, and whom Mrs. Parsons quotes as good authority, 
and who, like Mrs. Parsons, is decidedly the working chil- 
dren's friend, writes inThe Arena, before quoted, as follows : 

"Of all the States in the nation, Massachusetts is best 
equipped with legislation against child-labor. This legislation, 
moreover, is rigidly enforced, so rigidly, in fact, that Chief Wad", 
of the District Police, declares it as his conviction that the evil 
has been practically extirpated in this commonwealth. So confi- 
dent is he of this, and so anxious is he to enforce the law to the 
letter, that he would regard it as a favor to have any one report 
to him a single case in which the law is violated." 

This testimony renders it reasonably certain that most of 
the evils which have at some time attended the employment 
of children in the factories of Massachusetts are destroyed. 
What Massachusetts has done, other States can do. Indeed, 
other States are following rapidly in her footsteps. The 
laws of Illinois forbid children to work more than eight 
hours per day in her factories, and provide for a rigid in- 
spection of the same. In New Jersey, Rhode Island, Con- 
necticut, Pennsylvania, New York, and, in fact, in the manu- 
facturing districts throughout the country, legislation and 

170 



THE LABORER AND THE CAPITALIST. 

other methods are being brought into play to extend pro- 
tection to factory-employed children, and, indeed, to all 
working children. 

The census of 1890 places the wage-earning children in 
the United States in all occupations at 1,118,258. If we 
assume the number of children now earning wages in the 
United States to be 1,500,000, which is probably a 
high estimate, and if we further assume the average 
wages paid to children to equal the average wages paid 
to adults, it would still follow that less than 7 per 
cent, of the whole wage is received by the younger 
class. Therefore, they could not, if they would, furnish 32 
per cent, of the support of families, as assumed by Dr. 
Strong. But it is well-known that the rate of wages paid 
to this younger class is not equal by a great deal to that 
which is paid to older employees. Probably not 1 per 
cent, of the wages paid in the United States is received by 
the class in question ; therefore, the share of support ren- 
dered to families by children, although very great and very 
important in individual cases, appears, and, in fact is, almost 
infinitesimal when considered with reference to the vast sum 
which goes to support all the families in the United States. 

It would be sad indeed, if Dr. Strong were right in the 
assumption that the prudent and industrious workingmen 
of Massachusetts and throughout the United States were 
unable to earn a home, or to lay by something for old age ; 
but does such a condition exist ? Has it ever existed, except 
in momentary crises, as it were, when the profits of capital 
had disappeared, or so dwindled, that it could not employ 

171 



THE LABORER AND THE CAPITALIST. 



labor without destroying itself? Has the condition de- 
scribed by Dr. Strong existed during the years from which 
he has quoted his figures ? 

I have before me a statement regarding Savings Banks 
in 1887 J by Henry V. Poor, editor of " Poor's Manual for 
the Raiboads of the United States." It goes a long way 
toward revealing the true situation of the classes in question 
in the State of Massachusetts and in other leading States 
as well. The following is Mr. Poor's statement: 

* Classification of accounts of the Massachusetts Savings Banks. 

NUMBER AMOUNT 

'Whole number. 944,778 

Of $50 or less 344,640 $5,023,400.25 

Exceeding $50 and not more than $100 91,072 6,535,392 .08 

Exceeding $100 and not more than $200 113,671 15,989.821.29 

Exceeding $200 and not more than $500 155,547 51,109,495.61 

Exceeding $500 and less than $1,000 129,111 92,474,535.90 

Of $1,0U0 or more 110.737 131,779,298.73 

To the credit of women, both adult and minor 458,376 146,402,334 . 53 

To the credit of guardians 5,920 2,812,590.84 

To the credit of religious and charitable associations 7,147 3,997,107.15 

In trust 86,803 31,059,015.67 

The number of Savings Banks in the State in 1887 was 173 ; the average percentage of earnings 
to total assets equaled 4.82 ; the average rate of interest paid to depositors equaled 4.06 ; the amount 
of dividend paid equaled $11,155,440 ; the whole amount of profits equaled $15,286,193. The num- 
ber of withdrawals during the year, including dividends, 604,415. The amounts withdrawn equaled 
$58,861,246 ; number of accounts opened, 150,274 ; number closed, 107,738. The expenses of man- 
agement of all the banks the past year equaled $747,295. 

The following statement will show the amount of deposits of Savings Banks in the United 
States, with the number of their depositors and the average amount due to each, by States, in 1886 
and 1887 : 





1886 


1887 


STATES 


Number of 
Depositors 


Amount of 
Deposits 


Average 

to each 

Depositor 


Number of 
Depositors 


Amount of 
Deposits 


Average 

to each 

Depositor 


Maine 


109,398 
121,216 

49,453 

848,787 

116,381 

256,097 

1,208,072 

91,681 
143,645 


$35,111,600 
47,231,919 
11,723,675 

274,998,413 
51,816,390 
92,481 ,425 

457,050,250 
25 335,780 
37,530,370 


$320.95 
389,65 
237.07 
323.99 
445.23 
361.12 
378.33 
276.35 
261.27 


114,691 

132,714 

53,810 

906,039 

119,159 

266,888 

1,264,535 

98,137 

156,722 

12,744 

59,565 

8,245 

377 

41,059 

9,933 

28,038 

39,6.38 

15,474 

90,245 


$37,215,071 

50,822,762 

15,587,050 

291,197,900 

53,284,821 

97,424,820 

482,486,730 

27,482,135 

42,219,099 

2,771,392 

19,020,962 

834,524 

11,307 

15,065,659 

2,312,013 

14,061,258 

9,969.019 

3,402,950 

70,077,899 


$324 47 


New Hampshire 


382.91 
28't 67 


Massachusetts 

Rhode Island 

C onnecticut ..*.-.. r 
New York 


321 ,40 
447,18 
365.04 
381 55 


New Jersey 

Pennsylvania 

Delaware ...... . 


280.04 
269,39 
217 46 


Maryland 

Dist. of Columbia... 


77,212 
7,605 


30,542,992 
793,943 


395.57 
104.40 


319,33 
101,22 
30 00 


Ohio 


34,553 


12,823,374 


371.12 


366 93 


Indiana 


232 75 


Illinois 








501.51 










251 50 


Minnesota ... 


14,361 
80,489 


3,654,528 
60,435,919 


254.48 
750.86 


219 91 


Califomia 


776.52 






Totals 


3,158,950 


1,141,530,578 


361.36 


3,418,013 


1,235,247,371 


361.30 







The total amount of deposits in all the Savings Banks in the United States in 1865 equaled 
J242,619,382 ; in Massachusetts, $59,936,482; in New York, $115,472,566. The mcrease of de- 
posits in all the banks has equaled very nearly $1,000,000,000, the rate of increase equaling 
600 per cent." 

172 



THE LABORER AND THE CAPITALIST. 

According to Mr. Poor, the deposits of all tlie savings 
banks in New England in 1886, equaled in round numbers 
$545,000,000. The loans and discounts of all the other 
New England banks equaled $325,000,000. In other 
words, the savings banks held about $220,000,000 more 
than all the rest of the banks of New England. 

Concerning the banks of New York, Mr. Poor says : 

*^The deposits in the savings banks of the State of New York in 
1886, equaled 1482,686,730. The loans and discounts of ail the 
National banks in the State equaled, in 1886, only $354,841,070, 
the savings banks lending more ready money than the National 
banks by the sum of $125,445,660," 

It appears from this that the savings banks of New 
England are loaning more money than aU the rest of the 
banks of New England, and in New York the savings 
banks are loaning more than the National Banks. Where 
does this money come from ? The answer is : It comes 
largely from the wage-earners and people of small means, 
usually called poor. 

In Massachusetts the number of depositors equal more 
than two and a half persons to each family in the State. 
If we strike from the list of depositors all the guardians, 
religious associations, and trustees, and all others whose 
deposits amount to a thousand dollars and upward, there 
will stiU be left more than three depositors for every two 
families, or 420,000 in the aggregate. If all the rich 
families in the State of Massachusetts were counted, they 
would not equal one-tenth of the number of depositors in 
her savings banks. In short, in no way can the '^eports of 

173 



THE LABORER AND THE CAPITALIST. 

the savings banks be studied, tliat tliey will not demonstrate 
that a very large preponderance of the money they hold is 
the property of wage-earners and those who are usually 
denominated the common people. 

The average amount due depositors was $321.40 in 
1887 ; in 1892 it was still larger, while the number of de- 
positors had increased 186,425. The value and bearing of 
these facts will perhaps be more clearly seen if we consider 
that the number of people opening accounts with the sav- 
ings banks of Massachusetts between 1887 and 1892 was 
greater than the combined population of two of her prom- 
inent cities, to wit : Lowell and Worcester ; and the addi- 
tional deposits of these people, which amounted to $78,- 
320,486, would have purchased the real estate of Florida 
or Delaware, or nearly one-half of that of Vermont at its 
assessed valuation in 1890. 

If we deduct from the moneys held by the savings banks 
of Massachusetts all that is deposited by guardians and by 
religious and charitable associations before mentioned, and 
all held in trust, and one-half of that ovv^ned by those whose 
deposits amount to a thousand dollars and upvv^ard, there will 
still be left an average of $400 to each family in the State. 

Another fact with much meaning in Massachusetts is 
that more than one-half of the individual depositors in her 
savings banks are females. The amount of their deposits 
is $146,402,334.53. Dr. Strong might have said of these 
that not one in one hundred owned a house, but the facts 
would have remained that the income from their bank de- 
posits would build 3,000 houses per annum at a cost of 

174 



THE LABORER AND THE CAPITALIST. 

$2^000 each. Or, if tliey saw fit to withdraw their deposits 
and invest them in that way, the result would be nearly 
75,000 houses ; allowing five dwellers to each house, they 
would furnish homes for 365,000 people, which is more 
than the city of Boston contained in 1880, and is more 
than equal to one-haK of the adult female population of 
Massachusetts at the present time. 

This does not look as if the fairer sex of the Bay State 
had been doomed to poverty, without power to own a home, 
or to lay by something for old age. And, of course, no 
argument is needed to prove that any relation which the 
female population may sustain to homes, or whatsoever prep- 
aration they are able to make for the necessities of future 
years, the same is true of the male population. One sex 
does not accumulate and the other fall behind. The lots of 
the two sexes are cast together, and their condition and 
prospects are necessarily the same; especially is this true 
where opportunities are equal; and it cannot be said 
that the opportunities of males to accumulate wealth are 
not equal to those of females in any of the United 
States. 

It is plain, therefore, that, as a rule, the industrious, in^ 
telligent, and frugal individuals of both sexes, and the fam- 
ilies of Massachusetts can, if they will, secure a home and 
independence for old age. And it is an encouraging fact 
that the conditions which prevail in Massachusetts are 
being duplicated more or less throughout the country, and 
especially in the manufacturing districts; see Trihime 
Almanac, 1894, page 154, as follows • 

176 



THE LABORER AND THE CAPITALIST. 



SAVINGS BANKS' DEPOSITS AND DEPOSITORS. 





1890-'91. 


1891-'92. 


State and Teeeitokies. 




2i 

fl'S 

jl 




II 


1- 


III 

55| 




140,521 
166,264 

72,702 

1,083,817 

131,652 

305,863 

1,477,819 

125,073 

236,312 

16,752 

135,004 

10,231 

9,894 

*5,834 

17,494 

2,533 

1,078 

1,770 

4,366 

4,309 


!|47,781.166 

69,531,024 

21,620,303 

353,592,937 

63,719,491 

116,406,675 

574,669,972 

32,462,603 

G2,150,b93 

3,602,469 

38,916,597 

703.2t)6 

375,440 

264,348 

3,286,155 

477,487 

181,630 

65,816 

1,420,798 

384,183 


$340.02 

418.19 

297.38 

326.24 

483.99 

380.58 

388.8ti 

258.55 

263.00 

215.05 

288.26 

68.73 

37.94 

45.31 

187.84 

188.50 

lti8.49 

37.18 

325.43 

89.16 


146.668 

109.949 

80.740 

1,131,203 

136,648 

317,9.25 

1,516,289 

131,739 

248,471 

17,318 

142,135 

1,303 

8,428 

6,247 

21,397 

4,569 

170 

1,698 

5,557 

1,950 

258 

*! 6,392 

84,779 

15,418 

*73,872 

180,391 

948 

*71,687 

35,123 


$50,278,452 

72,439,660 

24,674,742 

369,526,386 

66,276,157 

122,-583,160 

588,425,421 

33,807,634 

65,233,993 

3,626,319 

41,977,868 

60,178 

473,848 

282,425 

4,225,459 

572,523 

31,912 

220,046 

1,695,732 

279,783 

51,854 

1,292,913 

33,895,078 

3,754,622 

21,106,369 

36,959,573 

138.926 

28,115,384 

8,786,979 


$342 80 


New Hatnpshiire 


426 24 




305 60 


Massachusetts 


32o 67 


Rhode Island 


4S!5.01 




385.57 


New York 


388.07 
256.62 


Pennsylvania 


262 54 




209.39 




295.34 


District of Columbia 

West Virginia .. 


46.18 
56.^2 
45.21 


South Carolina 


197.48 


Georgia 

Florida 


125.30 
187.73 




129.59 




305.15 


Texas 


143.48 


Arkansas 


200.10 


Tennessee 


11,169 

78,885 
14,884 
*61,103 
150,326 
726 
*57,146 
*30,391 
26,896 


1,445,834 

31,258,086 
3,553,099 

16,362,302 

29,887,761 
94,687 

20,821,495 
7,688,677 
3,508,751 


129.44 
396.24 
238.65 
267.78 
198.82 
130.42 
364.35 
352.99 
130.45 


78.87 


Ohio 


399.80 
243.52 


Illinois 


28.-).72 




204.88 


Wisconsin . • .... 


146.59 


Iowa 


364.29 


Minnesota 


250.17 




*21,215 

* 167,667 

900 

*I3,596 

8,955 


2,893,276 

127,312,088 

149,449 

2,427,9-0 

1,193,967 


136.38 


California ... .... 


*136,497 

*1,062 

*7,994 

6,850 


114,164,523 

165,426 

1,682,040 

834,815 


836.39 
1.55.76 
210.41 
121.87 


750.32 


New Mexico 


166.05 


Utah 


178.53 


Washington 


133.38 






Total 


4,533,217 


$1,623,079,749 


$358.04 


4,781,605 


$1,712,769,026 


$358.20 





♦Partially estimated. 



Times have been hard for the past few years. Capital 
and labor have both suffered, and are still suffering*. The 
accumulations of other years are being drawn upon for the 
support of business, as well as families and individuals; 



176 



THE LABORER AND THE CAPITALIST. 

but the condition of the savings banks for at least three 
decades contradicts, and when carefully studied will 
annihilate the popular theory concerning the power of the 
masses to secure a home and something for old age. If we 
select from the last quoted report from among the prominent 
manufacturing States, say Massachusetts, Nevf York, Cali- 
fornia, Connecticut, Pennsylvania, Rhode Island, and 
lUinois, we find the increase in the amount of small savings 
in those States from 1887 to 1892 to have been $309,710,- 
047, and the increase in the number of depositors 760,649. 
That is to say, the increase in small savings and in the 
number of depositors in those States in the last five years 
has been greater than the increase in the population by 
more than 100 per cent., and the increase in the 
amount of saving^s has been even larg^er than in the number 
of depositors. 

The deposits in the savings banks in all the States in 
1892 amounted to the stupendous sum of $1,712,769,026, 
and averaged 1 358.20 to each depositor. The total num- 
ber of depositors was 4,781,605. Here is a mathematical 
proposition for those who contend that our laboring people 
cannot own homes, to wit: 

If we say that one-third of the money deposited in sav- 
ings banks belongs to a class of people already well to do, 
and this is certainly an over-estimate, the fact will still re- 
main that 4 per cent, annual interest on the deposits belong- 
ing to the wage-earners and the poorer class (at the aver- 
age rate of increase for the last ten years) will build many 
more homes at a cost of two thousand dollars each than 

177 



THE LABORER AND THE CAPITALIST. 

would be required to shelter the total increase in the popu- 
lation of the United States, from year to year, the immi- 
grants included. 

Now, let us look at this matter of home-owning in an- 
other way. 

As has been stated in a previous chapter, ordinarily the 
male heads of families are the home-owners ; as a rule, only 
these are e::p acted to own homes. The latest census re- 
ports show that there are more than eight million home- 
owners in the United States. Of course, these are very 
largely male heads of families. If we reckon live persons 
to each family, it follows that about forty million of our 
people are practically housed beyond the danger of being 
dispossessed for non-payment of rent. This leaves about 
twenty-t\70 million paying rent or living under conditions 
where the heads of famihes are paying rent. These heads 
of families number in the neighborhood of four and one- 
half million. It is probably safe to estimate that not more 
than five million families at the very outside are paying 
rent in the United States at the present time. This does 
not look as if our people were in a wofully homeless condi- 
tion, since about two-thirds of the natural home-owners al- 
ready own homes. 

But what ought to be said concerning the one-third of 
the heads of families not sheltered beneath their own roofs? 
Is it owing to a wrong distribution of wealth that these people 
do not own the tenements they occupy ? If so, the reason is 
not apparent. On the other hand, the reasons why the pres- 
ent distribution of wealth is not responsible are very plain. 

178 



THE LABORER AND THE CAPITALIST. 

In the first place, as previously stated, more than one- 
half of our homeless population are colored people and 
foreigners, not many years removed from environments 
which were by no means well calculated to develop those 
faculties of the mind which lead to home-makinsr and the 
accumulation of wealth. When these classes of people are 
counted out, so to speak, then of all the families in the 
United States which could reasonably be expected to have 
secured homes under any condition of prosperity or through 
any rational distribution of profits, there remain less than 
three million. Of these there are a large number living in 
rented houses, but who could, if they saw fit, purchase and 
pay for a house of their own. A very large majority of 
those engaged in business in New York City and in the 
larger cities throughout the country do not own the tene- 
ments they occupy with their families. They prefer a fiat 
tenement, with rooms all on one floor, and janitor service 
free, to living in a house, with long flights of stairs for 
their families to climb and a great deal of extra help, wliich 
is not only annoying, but expensive. A respectable city 
residence costs from fifteen to twenty-five thousand dollars, 
and most manufacturers and trading men find it more prof- 
itable to use that amount of money in business than to in- 
vest it in a home. 

But the class of people which has given rise to at least 
nine-tenths of modern tenement-house discussion, and which 
is (blamelessly perhaps) at the bottom of no small percent- 
age of the existing prejudice against accumulated wealth, is 
yet to be considered. I refer to a certain class of foreigners, 

179 



THE LABORER AND THE CAPITALIST. 

of whom it is said that they are living in squalor and rags, 
with their apartments swarming mth vermin. It is proper 
to state that the class in question are not recognized as 
associates by the larger proportion of our foreign-born cit- 
izens. 

These people have crowded themselves and been crowded 
by a few of their better-informed foreign countrymen into our 
cities, where they have made filthy dens of tenements once 
clean. Landlords are not blameless. It is the moral duty 
of house-owners to see to it that their property is not let to 
those who have no regard for cleanliness. It is said that 
these filthy people do not receive wages sufficient to enable 
them to live in decency. It is true that many of them are 
being sweat and oppressed, more or less, not by Americans, 
as already shown, but by their own countrymen, bred within 
the same environments. 

There is no question but that, as a rule, the wages paid 
to this unfortunate class of foreigners are too low. Never- 
theless, in that part of New York City where most of these 
people reside, there is a saloon to every 191 of the popula- 
tion. That is to say, every 38 families of these poorly-paid 
laborers find money to support a liquor saloon, which proba- 
bly requires an average daily outlay of not less than fifteen 
dollars, or about 37 cents per day, for each family. If, in- 
stead of wasting this 37 cents per day for liquor, each of 
these families would save and place it at compound inter- 
est at 6 per cent., in 20 years it would amount to about five 
thousand doUars. Or, reckon the interest at 4 per cent., 
which is about the usual rate paid by savings banks, and, 

180 



THE LABORER AND THE CAPITALIST. 

the amount of money they are now expending for liquor 
would, in fifteen years, build them good homes in the sub- 
urbs of any American city, or it would purchase the tene- 
ments they now occupy. 

Can it be truly said, therefore, that the power to own a 
home in the United States does not, as a rule, extend even 
to our poorest paid laborer ? At all events, it is very plain 
that the fragment of Massachusetts statistics, quoted by Dr. 
Strong, however truthful as far as they go, are nevertheless 
insufficient in themselves. Indeed, they are misleading 
when detached from her larger data, bearing directly and 
indirectly upon the same subject. 

This being true of Massachusetts, of course, the figures 
have no such meaning for the whole country as Dr. Strong 
has assumed. In short, his position is rendered absolutely 
untenable by statistics covering the whole ground. 

The savings banks reports show incontestably that our 
wage-earners and people of small means are not only saving 
more and more as individuals, but that the number of savers 
is increasing out of all proportion to the increase in popula- 
tion. If these people think it more profitable to loan their 
money to industries through the savings banks than to in- 
vest it in homes, it is their privilege to do so ; but the fact 
remains that the interest on the money they have saved in 
the last few years, is swelling their income at the rate of 
probably not less than $40,000,000 per annum. 

We cannot, therefore, look upon the condition of a cer- 
tain class of people, confined mainly to the lower wards of 
the larger cities, as indicating a general wrong division of 

181 



THE LABORER AND THE CAPITALIST. 

profits^ and a growing dependency on the part of our gen- 
erally industrious^ cleanly, intelligent, and frugal populace. 



CHAPTER II. 

DOES LABOR RECEIVE A JUST SHARE ? 

In Tlie Arena (a magazine published in Boston), for 
June, 1894, appeared an article written by Walter Blackburn 
Harte entitled ^^ The Back Bay: Boston's Throne of 
Wealth." The following are some of Mr. Harte's remarks 
concerning this avenue and its residents : 
'*0n either side of this magnificent avenue . . . are the 
mansions of those fortunate ones who graciously permit the million > 
to toil for them upon their own terms and conditions, and for such 
length of time as they see fit, and then dividing the proceeds, 
hand over to the workers enough to keep breath in them so long 
as they are needed." 

There are a great many people who indorse Mr. Harte's 
proposition. They reason that capitalists have an abun- 
dance, and can afford to wait, but that labor is poor, stand- 
ing on the very threshold of hunger, and cannot wait- 
that capitalists knowing this have fixed the rate of wages 
at a point where workers can barely exist, " enough to 
keep breath in them," as Mr. Harte expresses it. But our 
ovfn e very-day observation cannot fail to convince us, 
if we stop to think, that the rate of wages is not fixed with 
the slisrhtest reference to the cost of existence. I know of 

182 



THE LABORER AND THE CAPITALIST. 

two salesmen^ for example, one receives $30 per week^ and 
the other |50j and the cost of living is greater with the 
one receiving the smaller salary, since he has a wife while 
the other has not. 

Here and there is seen an employer selfishly taking 
advantage of the necessities of an individual, and getting 
service for less than the service is worth, and this has given 
a wrong coloring to the whole subject. But that these are 
isolated and exceptional cases, and do not materially effect 
the general rate of wages or the final division between 
capital and labor, is demonstrated by the fact that wages 
differ more than a thousand per cent, with different 
individuals, while the cost of bare existence is about the 
same for all men. The same fact is also demonstrated by 
the general opposite movement of the rate of wages and 
the cost of the necessaries of life. If the amount paid to 
workers was determined by the cost of the necessaries of 
life, it would certainly follow that, as the cost of these 
necessaries fell, so would wages fall ; but exactly the 
opposite has taken place, and that too, in a very marked 
degree, to wit : 

The rate of wages in most industries has doubled in the 
last fifty years, while the cost of the necessaries of life has 
decreased by at least 30 per cent. Thus rendering it mathe- 
matically certain that neither the cost of bare existence, 
nor the cost of any other kind of existence, for that matter, 
determines the rate of wages, or the laborer's share in the 
rewards of industry. 

The following was pubhshed by the New York Press, 

183 



THE LABORER AND THE CAPITALIST. 

November 6, 1894, as the language of the Journal of Com' 
merce the day before : 
**Ke viewing, in the light of facts, the positions of capital and 
labor respectively, for the last half generation, it is thus evident 
that, relatively, labor has had much the best of it in the co-part- 
nership of the two interests." 

This is the first time I have seen it even hinted in print 
that in the general division of the results of industry capital 
had failed to get more than a rightful share. Yet, it not 
infrequently happens that capital, as a whole, overpays 
labor, very much. And here is involved one of the most 
important principles of industrial science ; yet, it seems not 
to have attracted the attention of our economists. 

It will be remembered that in a preceding chapter of this 
work it is stated that a great many failures could be pre- 
vented by promptly cutting wages when prices begin to fall 
and profits dwindle ; but that in many cases of shrinking 
prices and dwindling profits, employers continued to pay the 
same rate of wages, until they were overtaken by bank- 
ruptcy. This is a fact plain to all who will take the trouble 
to look into the matter ; and it is one of the ways in which 
labor receives more than its rightful share. 

In the failures that have taken place in the United States 
within the last thirty years, the liabilities, that is, the un- 
paid debts at the time of failure, have amounted to about 
five billion dollars ; a sum larger than the assessed value of 
Maine, New Hampshire, Vermont, Connecticut, Ehode Island, 
and Massachusetts. 

According to the best authority (Bradstreet) about 11 

184 



THE LABORER AND THE CAPITALIST. 

per cent, of these defaulters went through the failing proe^ 
ess to make money. A small portion of the rest have 
finally squared their accounts with their creditors. Many of 
these, however, have done so through a loss to themselves 
of their investment and all the profits of their business 
years. But, in all cases, or so nearly all that the exceptions^ 
are not worth considering, the help employed by the failing 
parties received their pay. So that no small percentage 
of the Habilities reported represents money paid by 
capital to labor, over and above what capital could safely 
spare. 

Now if we except the failures where, strictly speaking, the 
failing concerns did not employ labor to any very great ex- 
tent, then no reckoning that can pretend any approach to 
fairness will place the aggregate unpaid debts in question be^ 
low three billion dollars ; a sum larger than the assessed valua^ 
tion of all New England, omitting Massachusetts. What 
has become of the money representing this huge pile of 
debt ? The creditors have not received it. The failing 
capitaHsts have not received it. Labor is the only party 
concerned that has received full pay. Had labor understood 
the situation and allowed capital a safe profit, business 
would have continued active where stagnation has many 
times reigned. 

In short, it has often occurred that through labor getting 
too large a share of the results of industry, employers 
have lost the capital they once had, and their employees 
lost the employment they might have had. 

Concerning a particularly fine house on Commonwealth 

185 



THE LABORER AND THE CAPITALIST. 

Avenue, and the poor people living not far away, Mr. 
Harte writes as follows : 

'"This great pile of stones is devoted to the sheltering of two not 
extraordinarily indispensable persons. Within thirty minutes' 
walk of this mansion are men and women huddled together, some- 
times as many as seven or ten people in a cellar, without heat, 
without food, with but a bundle of rags to serve all as bed. 

'^ The aggrega^te cost of the mere luxuries of the table consumed 
in this one street (meaning Commonwealth Avenue), would be 
sufficient to properly house the poor, stifling, and degraded in the 
filthy tenements of Boston. . . ." 

Kef erring to the churches on Commonwealth Avenue 
and around about, and the remedy for the evils complained 
of, Mr. Harte submits these propositions : 

** These churches, as much as the mansions which surround them, 
are built with blood-money, at the cost of blighted human lives and 
human souls. 

" The remedy does not lie in any appeal to humanity. That 
never served any cause yet. It lies in breaking the bonds of 
slavery through the ballot." 

This statement regarding the buildings and residents of 
Commonwealth Avenue, however well intended, is, never- 
theless, calculated to give the laborer an incorrect impression 
of his interest in the matter. From Mr. Harte' s representa- 
tion, the laborer might infer that the costly structures of Com- 
monwealth Avenue represent labor unrev/arded, or at least 
but poorly rewarded. While as a matter of fact it cannot 
be shown that the labor represented in the buildings on this 
avenue, or on any other avenue for that matter, has not been 

186 



THE LABORER AND THE CAPITALIST. 

f airljT^ rewarded. In fact nothing can be more clearly dem- 
onstrated than that labor has, on the whole, received a fair 
share of a common industrial eiiort, whether it be represented 
in buildings or what not, and the workman may look upon the 
structures that rise on every side as labor paid for, and he 
may think of the money he received, not as tied up in the 
building, so to speak, but as still passing from hand to hand, 
paying labor for building other structures and performing 
such other services as the necessities of our civihzation de- 
mand. Yea, more ! No inconsiderable portion of the build- 
ings we behold are mortgaged by their owners for the very 
money that is now doing the business of the country, and 
keeping labor employed. So that instead of the workman 
looking upon the costly structures of our cities as repre- 
senting unpaid labor, he should regard them, not only as 
labor paid for, but as a guaranty for his continued employ- 
ment. 

Since the foregoing statements by Mr. Harte came to 
hand another has been brought to notice, which may be 
profitably considered in connection therewith. It appears 
in the National Watchman, November 2, 1894, as follows : 

"The struggle of tke masses for a fair share in the values created 
by the labor means much more than a mere increase of a money 
return. It means a great social advancement ; it means the rising 
of the workers to a higher social plane. It means higher educa- 
tion, greater refinement, improved social conditions, general mental 
development. It means the starting of the people of the nation 
upon a new stage in the march of national progress. It means 
the elevation of the race. It means that after the industry of the 

187 



THE LABORER AND THE CAPITALIST. 

nations has provided the viands and the luxuries for the feast of 
civilization, all shall sit down at the board, groaning with the 
creations of their skiU and labor, and enjoy the repast ; and that 
the workers shall not creep off like dogs to their kennels, while the 
feast they have prepared is enjoyed by the drones of society." 

It is hardly necessary to state that these quotations eon- 
tain the gist o£ popular belief concerning present condi- 
tions, as well as the expectations of a great many people 
regarding what is to be in the good time coming. That is, 
the possessions of the rich are wrung from the poor, blight- 
ing their souls and ruining their earthly prospects; and 
when the bonds of wage slavery shall have been broken 
through the ballot, as they express it, and a system of gov- 
ernment inaugurated under which a few will not get rich, 
nor any remain in poverty, the tables of all are to groan 
under the weight of choice viands ; the costly garments of 
the masses will glitter in the sunlight, and the toiling mill- 
ions bound swiftly up the now slow and difficult ladder to 
broad culture, scientific attainment, and freedom from anx- 
iety concerning the material necessities for coming years. 

We have tens of thousands of good people who are highly 
cultivated and well provided for, so far as their physical 
necessities are concerned, yet they feel the privations of the 
poor more keenly than the poor themselves. They would 
banish poverty from the earth and place the human race 
where no child could be born doomed to drudgery, nor the 
fear of dependence and destitution haunt the dreams of 
honorable old age, as it sometimes does under the present 
regime. 

188 



THE LABORER AND THE CAPITALIST. 

A lofty purpose this, so far as motive is concerned ; 
but is it possible of accomplishment? Can drudgery, for 
example, be abolished? With all our progress in invention 
in every department of industry, has drudgery been really 
and absolutely lessened? There has probably been as 
much improvement in the culinary department as in any 
other. The closed fire has taken the place of the torturing 
blaze on the hearth, over which the housewife formerly 
bent, and the trim iron range with appliances to regulate 
the heat with great nicety has taken the place of the awk- 
ward hole in the huge brick chimney of olden time. Yet, 
is cooking any the less a drudgery? That is, do the 
damsels of 1894 engage in kitchen work with better relish 
than did the damsels of 1844 ? 

The farmer once cut his grain with a sickle, and when 
he had reaped one acre he had performed a good day's 
work. Now his horses reap, while he rides upon a spring 
seat, and ten acres is a day's work. But, do the young- 
men of to-day take to the cultivation of the soil more 
readily than did the young men of fifty years ago ? Has 
the sewing-machine made it less a drudgery to make a gar- 
ment for either male or female? With our modern im- 
provements we can produce a larger quantity of anything 
in a given time, but a larger quantity is demanded. Our 
wants have kept even pace with the multiplied means of 
production, and the increasing purchasing power of our 
income, so that the drudgery of supplying the necessities 
(or what we call necessities) of life, is as great as ever — 
yea, greater ; and our discontent is greater also. The ser- 

189 



THE LABORER AND THE CAPITALIST. 

vant girl of to-day makes a shorter week by at least thirty 
hours than did the servant girl of fifty years ago, and not 
infrequently she owns jewelry that cost more money than 
our grandmothers could afford to spend for a wedding 
dress ; yet she feels that she is a poorly paid drudge, and 
prays to be delivered from such bondage. 

The same state of facts exists with a majority of the male 
employees of our time. A skilled workman can pay for a 
home in fifteen years such as only the rich could own 
half a century ago, and yet he chafes as never before over 
his low wages and houseless condition. Indeed, with higher 
wages and shorter hours, and a thousand more privileges 
and advantages, the laborer is becoming more and more dis- 
contented. For this he is complained against as lacking in 
appreciation. But, are the rest of us any more philosophic 
or consistent than the wage-earner ? 

Do we appreciate the progress of the age, and the privi- 
leges and advantages we enjoy that once appeared beyond 
our reach ? Our houses are far superior in size, in elegance, 
in convenience, and sanitary arrangement to those we once 
occupied, yet they do not suit us, the principal reason being 
that somebody else has one still superior to ours. We have 
accumulated a fair amount of wealth, yet somebody else 
has accumulated more. We can afford to wear richer 
clothing than formerly, but some of our neighbors can outdo 
us. Machinery has made it possible to accompHsh vastly 
more work, but it has not made it easier for either the rich 
or the poor to satisfy their wants, and we all drudge — or 
think we do — if not in one way, we do in another. 

190 



THE LABORER AND THE CAPITALIST. 

Rich women, for example, do not drudge in the same 
way as poor women, but in a manner quite as irksome to 
them. The late wealthy Cortlandt Palmer said substan- 
tially in a public speech that the labor performed by the 
rich on account of coachmen, house-servants, butlers, etc., 
and in keeping thoroughly informed regarding the rules of 
etiquette and changes in methods of cooking, etc., etc., was 
to them drudgery hard to endure, and in many cases very 
injurious to health. It cannot be doubted that the task of 
performing the duties and going through the almost end- 
less ceremonies demanded by what is called high hf e, tries 
the nerves, exhausts the energies, and deprives those women 
of more real happiness than do the tasks ordinarily imposed 
upon any other class of females, excepting a few of the 
really destitute. 

We are not content with what is really best calculated 
to promote health and comfort from a truly dignified and 
thoroughly practical standpoint. We want as much and 
as costly as anybody else has. We are led by whims. We 
do not cultivate individuality, and most people act as though 
they had no respect for it. The poor ape the rich, and the 
rich ape the richer. 

While labor has brought far greater rewards within the 
last thirty years than ever before, it was never so shunned 
as it has been during that same period ; and not one whit 
more is this true of the rich than of the poor and the com- 
paratively poor. Too generally are we imbibing loose 
notions of nobility and real worth. While labor now, does 
as it ever has and ever must, lie at the foundation of all 

191 



THE LABORER AND THE CAPITALIST. 

true and lasting success/ and give birth to every substantial 
achievement, it is rarely honored as it should be. Nothing 
can so develop the youth of either sex in the direction of 
real, wholesome beauty and sturdy vigor, physically and 
mentally, as plenty of reasonably hard work. And especi- 
ally is this true when such work is necessary to the 
maintenance of the individual, and the continuance of the 
same is made to depend upon skillful and faithful perform- 
ance. Yet very few of those whose children have been 
thus developed would be found willing to place them before 
the world, at any age, as brown and sinewy examples of 
what hard, necessary work can do for the human body and 
mind. They would conceal it, rather. A million mothers 
toil through the long day and far into the night that the 
hands of their daughters may not lose their whiteness, nor 
carry the marks of needle and kitchen into a kind of ball- 
room they had better never entered, and among a class 
of gentry who have not been taught the sublime lesson 
that in labor there is strength, dignity and virtue, and that 
idleness is the parent of mental and physical weakness 
and the forerunner of moral decadence. 

So long as necessary work is regarded as a task to be 
shunned, or a drudgery to be ashamed of, or until the 
fundamental and God-ordained truth is admitted and 
acted upon that it is as necessary, and therefore as hon- 
orable, to lay the foundation of the arch as it is to 
adjust the keystone, to dig the cellar as to build the 
superstructure, and until our struggle to gather and hold 
property is governed more by our real necessities and less 

192 



THE LABORER AND THE CAPITALIST. 

by a desire to satisfy a vitiated taste and to keep step with 
frivolous and unreasoning fashion^ we may rest assured 
that unwelcome toil will be our lot, and a feeling of poverty 
our constant companion. 

Very few are so rich that they do not fear that want 
may some time steal or rush in upon them; and a still 
smaller number are so circumstanced in life that at times 
they do not feel something akin to poverty, especially when 
they measure their own fortunes with the larger possessions 
of others. 

In short, when all the facts and forces which have and 
do now contribute to the disturbed condition of society, and 
distrust of existing economic methods are duly considered, 
only one conclusion is logical, to wit, the harmonious on- 
ward march of the race, the rich and the poor, the few and 
the many, cannot begin except through a changed way of 
viewing things, a wider sweep of vision over fields where 
lie the duties and responsibilities of life; a deeper 
searching for the springs of human action, not to say a dif- 
ferent rating of good and evil, of high and low, of what 
constitutes good and bad society, etc. In other words, 
without a change in our mental and physical habits, eco- 
nomic changes can bring but very little lasting good ; as, for 
example, if, with the marvelous increase in production and 
in the purchasing power of wages and incomes, discontent 
is becoming more and more intense, it stands to reason that 
still higher wages and larger incomes cannot, in and of 
themselves, bring the peaceful rest and satisfaction we so 
much desire. 

193 



THE LABORER AND THE CAPITALIST. 

While the motives of such as would revolutionize our 
economic system, so as to banish poverty and equalize con- 
ditions, merit respect because of their sincerity, yet, could 
these people bring about the change they so much desire, 
it would render impossible the very blessings they are pray- 
ing for, as well as a great many we are now receiving. It 
is the fiat of nature's God that variety shall exist everywhere, 
and that all happiness and all progress shall be the learning 
of differences, while all knowledge can be nothing more nor 
less than differences learned. Again, it is a principle of 
nature, written on every page of human history and declared 
in every forward step of the race, that the most perfect 
understanding and appreciation of differences must come 
through experience and close contact with the things to be 
compared, studied, or in any way dealt with. As, for ex- 
ample, one who had never felt the fire uncomfortably near, 
could not fully appreciate the gratitude of one suddenly 
reHeved from the terrible smarting of a burn. The poor 
shepherd boy experiences great joy at the sight of shoes 
that are to protect his torn feet from the fall stubble and 
frost and the winter's snow. But when spring has thrown 
her soft, warm carpet over the earth, and the more direct 
rays of the sun are beginning to be felt, these same shoes 
become burdensome, and the encumbered lad flings them 
away as gladly as he put them on a few months before ; but 
in both changes he has experienced a pleasure comparatively 
unknown to those whose feet never wandered unprotected 
over autumn fields, nor, shoeless, toughened on the naked 
ground. 

194 



THE LABORER AND THE CAPITALIST. 

Variety and change is largely the solace of life, and 
often renders pleasant that which would otherwise be 
counted burdensome. One reared in a level country loves 
to climb mountains. Upward, still upward, he joyously 
struggles, as each succeeding step reveals more and more 
of the vastness and beauty of the world below. His pleasure 
is in passing from one height to another, and he rests not 
satisfied while his strength lasts and a single peak remains 
unexplored. 

Level mountains ; soften climates ; place an abundance 
where all can have it by the mere taking ; remove all anxiety 
concerning the necessities of old age ; in short, banish 
competition and so change conditions that the now thrifty, 
energetic, aspiring, knowledge-loving American will have 
no more occasion to plan and hoard for the future than 
does the South Sea Islander, and he will very soon begin 
a backward and downward march to the level of that ig- 
norant and slotliful son of the Cannibal Isles. 

By this it is not intended to carry the idea that con- 
ditions are never too hard, but the all-important fact 
must not be overlooked that the two great forces which 
unite to make us progressive beings are desire and necessity; 
one beckoning, the other forcing, us along the pathway of 
improvement and up the hill of knowledge to loftier and 
broader views of life and creative energy. How far we 
can go in the direction of destroying competition and re- 
moving impediments to an easy, comfortable living, without 
at the same time weakening these forces, is a very serious 
question. 

196 



THE LABORER AND THE CAPITALIST. 

And as to drudgery, it cannot be abolished unless we re- 
fuse to recognize necessary work as drudgery. To one 
who does not comprehend the divinity and nobihty of 
labor, four hours per day is as irksome and distasteful as 
eight, provided he has never worked the eight, but is abso- 
lutely obliged to work the four. A certain amount of labor 
will always be indispensable to health, strength, cleanliness, 
sustenance, etc., and if we count it drudgery, the more 
energetic and aspiring one is, the more will he drudge, 
because the better care he takes of himself and the more 
he tries to accomplish the more labor he must perform, 
either physically or mentally, or both. 

But let us pause for reflection. This moralizing and 
philosophizing is well, yea, it is indispensable to a thorough 
and rational understanding of the position of the laborer 
and the capitalist. The masses, and, indeed, all classes, 
will sooner or later study the subject from a moral, phil- 
osophic and, if you please, a scientific standpoint. But 
now a theory is prevalent which greatly hinders unbiased 
and searching reasoning. This theory, if allowed to stand, 
means great and sudden social and political revolutions 
and wild attempts to accomplish the impossible. 

It is not an uncommon remark that two hours' work per 
day, or four at the most, with the results divided according 
to merit, which means according to the amount of labor 
performed, would enable the whole people to live luxur- 
iously. This is substantially the view taken by Mr. Harte 
and the National Watchman, quoted at the beginning of 
this chapter. 

196 



THE LABORER AND THE CAPITALIST. 

Mr. Harte thinks that the cost of the mere table luxuries 
of Commonwealth Avenue alone would comfortably house 
and feed those who Hve in the bad tenements of Boston. 
He does not attempt to show, he appears not to think it 
worth his while to consider as a part of the capital and 
labor problem, how large a percentage of the degraded and 
filthy people he describes might have been comfortably and 
even luxuriously housed and fed had they practiced the same 
industry, economy, temperance, and cleanliness that in a 
majority of cases brought wealth and luxury to the dwell- 
ers on Commonwealth Avenue. It is safe to assume that 
many a man now living in a fine house in Boston's Back 
Bay laid the foundation for his present fortune by the sav- 
ing of a smaller daily sum than many of those now de- 
graded and filthy families have been accustomed to spend, 
especially in good times, for liquor and tobacco. 

If Mr. Harte believes that the rich of Commonwealth 
Avenue can and ought to make the needy poor of Boston 
comfortable by donating the mere cost of their table lux- 
uries, he certainly ought to remember that the money spent 
for liquor by the poor of Boston amounts to not only more 
than do the table luxuries of Commonwealth Avenue, but 
more than the cost of all the luxuries of the whole city. 

Why not rail at these people for indulging so unreason- 
ably and wastef uUy in dangerous luxury, while some of their 
neighbors are sleeping on beds of damp rags in unheated 
tenements ? 

But, passing this by for the moment, what would Mr. 
Harte do with these destitute and, according to his account, 

197 



THE LABORER AND THE CAPITALIST. 

filthy people? He certainly would not be so unwise as to 
give them a large amount of money. The most he could 
think of doing would be to relieve the necessity of the 
moment^ and then agitate and consider, and induce others 
to consider with reference to the next step to be taken. 
This is precisely what is being done, and it is safe to say 
that nine-tenths of the reform in that direction is resulting 
from the efforts of rich and well-to-do people. Felix Adler 
and his rich co-workers built beautifully arranged and well 
lighted tenement houses in New York and filled them with 
the kind of people in question, but they would not be 
cleanly and make the most of their opportunities; in fact, 
in almost every particular they have disappointed the hopes 
of their T>^ould-be benefactors. 

Not distant from the aforesaid tenement houses is a free 
kindergarten, supported by the rich. At one time the 
teacher was beginning to instil temperance ideas into the 
minds of the scholars. Very soon parents began to find 
fault ; some even visited the school and informed the teacher 
that she must desist, or the children would not be allowed 
to attend. The teacher did desist. 

Of course there is no reasonable excuse for the undevel- 
oped and avaricious capitalist who allows his property to be 
used as it often is in the poorer districts of our cities, simply 
because it is bringing him dollars. But I repeat substan- 
tially what I have said in a previous chapter, to wit : The 
question, " What is to be done with the filthy occupants of 
filthy tenements?" is a thousand times more a question of 
morals, of education, of temperance, and of immigration 

198 



THE LABORER AND THE CAPITALIST. 

than of wages, although many of them are paid too small 
wages. 

The popular demand is that there shall be such a division 
of the results of industry, that the great mass of the world's 
people shall perform much less work than has been their 
custom, and at the same time have all the luxuries 
of life. If such a result is possible of accompHsh;^ 
ment, the demand is reasonable and just. That is, if it be 
true that enough is produced for all to fare sumptuously, and 
that the same would be true, even with much less work than 
is now being performed, it is but just and reasonable that 
the masses should have their full share of the benefits. But 
can it be accompHshed? Let us see what light reliable 
statistics can throw upon this subject. 

Of course calculations cannot be made with perfect ac- 
curacy in a case like this, but an approximation can be 
reached that will be sufficient for all practical purposes. 
The road I propose to travel to the proposition, in its final, 
ity, is not very direct, but it will be found to reach the ob- 
jective point at last. Let us first ascertain as nearly as 
possible, what share of the results of industry capital actually 
receives. This cannot be determined with perfect exactitude ; 
nevertheless, the average rate of interest and dividends 
show very nearly what percentage of the product of in- 
dustry goes to capital. 

The average rate of interest and dividends paid during 
the last year has not been far from 6 per cent, on invested 
capital. Thus capital has received about 6 per cent, and 
labor about 94 per cent, of the joint earnings of capital and 

199 



THE LABORER AND THE CAPITALIST. 

labor for the year 1894. This calculation will appear very 
wild at first glance to those who have so long held the opin- 
ion that capital gets an immensely preponderating share of 
the product of a common industrial effort. Yet^ how absurd 
it is to insist that capital gets a larger percentage of the 
results of industry than the average rate of interest and 
dividends. Indeed, capital is constantly in the market, 
seeking an opportunity to engage with labor in any prom- 
ising business, and receive for its share 6 per cent, on the sum 
invested, and often only 4 per cent, and sometimes as low as 
three per cent, will secure the investment and co-operation 
of capital in commercial and industrial enterprises. In 
short, as a rule, capital only asks and only expects 6 per 
cent, for its share. Why should it be claimed that it gets 
more ? 

But, for the sake of the argument, let us assume that 
invested capital does get more than 6 per cent.; or, 
suppose that the income of capital rises to 50 per cent, per 
annum. Who will be benefited ? You say, " Capital will 
be benefited." 

Very well, let us assume for the moment that the bene- 
fit would accrue to the capitalists only. The next logical 
question then is : Who are the capitalists ? Ah, here is the 
rub. This question means much, yea, it means everything 
to the capital and labor controversy. Where shall we draw 
the line and say that all above are capitalists and all below 
are not, since almost every adult person has capital; the 
difference being that some have more than others? 
But, you say, when we speak of capitalists, we mean very rich 

200 



THE LABORER AND THE CAPITALIST. 

people, millionaires, for example. Very good, but it would 
be inconsisient to claim that millionaires would be bene- 
fited by an increase in the income of capital, unless it be 
admitted that all other capitalists would be correspondingly 
benefited ; for there is no law, statutory or economic, under 
which millionaires can receive a benefit from the investment 
of capital that the less wealthy capitahsts are not certain to 
share. It is very illogical to complain that millionaires 
have become more plentiful of late, and at the same time 
charge that the opportunity to accumulate wealth has been 
growing less ; for how do more men attain millions, if the 
road to millions is not easier ? How can a larger and 
larger number gain the mountain top, year after year, 
except it be that more and more are making headway toward 
that point ? In other words, it is impossible that there be a 
greater number of the very rich, unless there be a greater 
number of the comparatively rich, or to state the same fact 
in still another way the increase of millionaires implies that 
there are more men worth nine hundred thousand and so 
on down the line. 

This is a very plain truth if we stop to consider that 
when a million dollars yields a profit, great or small, each 
dollar produces one-millionth part of it. In other words, 
the total gain is the gain of each and every dollar gathered 
into one sum. And is there any good reason why a dollar 
invested by a smaU capitalist should not yield as large a 
profit as one invested by a larger capitalist? 

Of course the popular theory is that the richer capitalists 
do business on so large a scale and sell so cheap that small 

201 



THE LABORER AND THE CAPITALIST. 

capitalists cannot compete with them. I have discussed 
this proposition in a preceding chapter, but it is so little 
understood, and yet so important, that some further illus- 
trations may be necessary. 

It is not difficult to see that if it be true that the larger 
business concerns undersell the smaller the masses are ben- 
efited by it, because they get their goods cheaper, which 
must leave a larger opportunity for saving. 

But, you say, this crushes the small trader. Suppose it 
does ? We want to benefit the many working people 
rather than the few traders. What right has the small 
trader to ask that the people pay a higher price for goods, 
or that we be compelled to run all over town among a hun- 
dred small establishments to get, perhaps, not more than 
a dozen articles, when the larger concern places them all 
before us under one roof at lower rates ? 

But all this does not satisfy the masses that rich people 
do not rob them of their earnings, neither does it convince 
the small trader that the large aggregations of wealth are 
not against his interest, and the whole blame is laid at the 
door of the rich. But, as a question of fact, how much do 
the rich have to do with it ? In other words, if large ag- 
gregations of wealth have rendered it harder for the original 
proportion of small traders to do business single handed, is 
it really the rich that are causing it ? Are not smaller in- 
vestors the very persons most powerful in bringing about 
the condition complained of ? As, for example, suppose a 
very small dealer cannot compete successfully with that old 
and powerful concern in Boston known under the firm 

^0% 



THE LABORER AND THE CAPITALIST. 

name of Field, Bulerant & Field. Who is it that stands 
most in the way? The small dealer says it is the 
rich, and he looks upon Field, Bulevant & Field as his 
especial enemies, crushing him with their wealth. I cannot 
speak authoritatively regarding the wealth of either Field, 
Bulevant, or Field. It is not necessary that I should. The 
important fact is that the concern bearing their names is 
owned by about fifty individuals. This renders it abso- 
lutely certain that whatever crushing is being done under 
the firm name of Field, Bulevant & Field is the work not 
entirely of three rich men, but of fifty persons, many of 
whom are necessarily small investors. In short, it is highly 
probable that the large business in question is being carried 
on by individuals, most of whom have less money invested 
than have a majority of the small outside traders who com- 
plain that they are being crushed by the rich. 

All large business houses, however, have not as many 
owners as the one just discussed, but it is John Doe & Co., 
Samuel Jones & Co., and corporations everywhere, and the 
investors therein are legion. Indeed, the number of in- 
vestors in the business of the country, and especially in the 
large concerns, is so great, and the invested capital so 
largely in the hands of the many, that the very rich are 
controlling but a very small percentage of the business of 
the country. Nevertheless, this view of the case is so de- 
cidedly contrary to the old and popular one that nothing 
short of a mathematical demonstration will be generally 
accepted as proof. Such evidence will be found in the 
following chapter. 

203 



THE LABORER AND THE CAPITALIST, 
CHAPTER III. 

MILLIONAIRES AND THE PEOPLE. 

A document circulated in New York City by a labor can- 
didate for Congress in 1893 contained the following : 

'*Two hundred and forty thousand people in New York City 
alone, at this very hour, famishing for bread: 165,000 persons 
evicted from their homes in this city in a single year, five times 
more than were ever rack-rented in Ireland in a similar period. 

' ' Seventy thousand miles of railroads passing into the receivers' 
hands in less than two months. 

"Over 125 banks suspend in six months. 

*' Twenty-six thousand persons own over half the wealth of the 
United States. 

"Fifty men own and control every avenue of possible wealth." 

In 1892 the New York Tribune instituted a census of 
the country for the purpose of ascertaining the number of 
millionaires. The result was the discovery of 4,047 per- 
sons reputed to be worth a million dollars or more. The 
following is copied from page 4 of the Tribune's report : 
''No attempt has been made to estimate the exact wealth of the 
persons who are named in these lists. The fact is, no one can 
teU exactly how much any man is worth until after he has passed 
away and his executors have paid his debts and settled up his 
estate. A man's profits, or his opportunities, or his style of liv- 
ing, sometimes lead to the popular belief that he is worth many 
millions. But no one knows about his losses, or whether he really 
took advantage of his opportunities, or what sums of money he 

204 



THE LABORER AND THE CAPITALIST. 

has given away to public institutions or his relatives ; or what 
sums of money he is owing for. Popular estimates of the exact 
wealth of different persons are exceedingly wide of the truth, most 
of the time, and it would be so difficult, expensive, and, in fact, 
inquisitive to obtain expert estimates, that it is better not to go 
into that branch of the subject at all. A case in point will show 
how mistaken is the popular idea of some people's wealth. The 
president of one of the great railroads of the country was lately 
mentioned in a published list of a few hundred "millionaires" as 
worth the enormous sum of $20,000,000. If this upright, able, 
and honorable man had actually taken advantage of the opportun- 
ities he has had of operating for his own benefit, he might possi- 
bly have accumulated the sum of money named. But he has al- 
ways managed the road in the interest of its stockholders, and he 
is actually worth not more than a million, if, indeed, he is worth 
that. Some of the men reported a year ago, when this investiga- 
tion first began, as worth a million, have died since then, and their 
estates have been found far below the million mark. It is hard, 
therefore, to say, who is actually worth a million." 

I will not suggest that the real value of the property of 
the 4,047 reputed millionaires is as much below the popular 
estimate as is that of the one referred to by the Trihime, 
whose reputed wealth of $20,000,000 turns out to be only 
one million, or less. But if the reader will take the results 
of his own observations, as a basis to calculate from, he 
will reduce the popular estimate of the wealth of the afore- 
said 4,047 individuals at least one-half. 

How many rich men have you ever known whose v^ealth 
was not over-estimated by their neighbors — not slightly 
over-estimated, but a great deal? It is not often that a 

206 



THE LABORER AND THE CAPITALIST. 

very rich man's neighbors guess nearer the actaal value of 
his property than did those of the late Mayor Harrison of 
Chicago. They were estimating him worth from three to 
four million, when his death revealed the fact that he had 
less than 1900,000. It is doubtful, to say the least, 
whether the property of the aforesaid 4,047 reputed mill- 
ionaires would this day sell in market for a price that would 
leave the owners one-half of the sum they are reputed to 
be worth. Such men are usually very large borrowers, 
and their decease almost invariably reveals heavy demands 
against them. 

Then, too, ranch property, milling enterprises, tunneling 
schemes, and mining ventures, etc., in which so many of 
such men are apt to have large investments, are by no 
means certain to yield the results they appear to promise ; 
and scarce a week passes that more than one reputed mill- 
ionaire or very wealthy concern does not turn out to be 
bankrupt. 

But, for the sake of the argument, let us assume that the 
aggregate wealth of the 4,047 individuals in question 
reaches the amount guessed by Trihime informants, or, 
say, to make it an even number, $4,000,000,000. Well, 
what of it? 

It is probable that more than nine-tenths of the people 
of all classes are of the opinion that enough is produced to 
make everyone well off, if it was properly distributed, 
but that the few get it and the many suffer on in poverty. 
Let us see. There were millionaires in the country 
as far back as 1830. But we will assume that the four 

206 



THE LABORER AND THE CAPITALIST. 

billion dollars worth of property in question has been only 
sixty years in accumulating ; and let us also assume, for 
the moment, that every dollar of it has been wrongfully 
taken from the masses 5 how much has the individual lost 
each day? 

Of course, this question cannot be accurately answered, 
but then, we do not need to be accurate in this case, nor is 
it necessary to make many figures in order to dissipate the 
popular delusion and annihilate the common theory that 
the people have been handicapped in their movements, or 
that they have fewer homes or less clothing, or that their 
tables are less luxuriously furnished on account of what 
the millionaires have gained. 

To begin with, we will place the average population of 
the country for the last sixty years at forty millions. We 
will then estimate that two generations have come and gone 
during that time. The accumulations of the country then 
for the last sixty years have resulted from the labor of eighty 
milHons of people. In sixty years there are 21,900 days. 
Now, upon the theory that the millionaires have taken their 
four billion from the people, each citizen has contributed 
about one-fifth of one cent per day. How much can one 
luxuriate on one-fifth of a cent per day ? How much of 
the good things of life will it buy ? Or, to submit sub- 
stantially the same proposition in other words : If the 
masses had had each day the percentage of the products 
of industry that has gone to the four thousand very wealthy 
men, would it have loaded their tables with rich viands, 
built them costly houses, covered their bodies with finer 

207 



THE LABORER AND THE CAPITALIST. 

clothiDg than they now wear, and at the same time relieved 
them of any considerable proportion of the so-called 
drudgery they have been performing ? 

There comes to mind the story of a peasant who com- 
plained to one of the Rothschilds that he was cruel in with- 
holding his vast wealth from the people when they needed 
it so much. The peasant was asked if he thought there 
ought to be an equal division ; he answered yes. Mr. Roths- 
child immediately drew a very small piece of money from 
his pocket and handed it to the peasant with the remark : 
" Here, sir, is your share." 

A thorough mastery by the people of the principle here 
involved is one of the pressing needs of the hour. 

A few years since a great multitude of poor people formed 
in line and marched by the Lord Mayor's house in London. 
They probably believed that the accumulations of the Lord 
Mayor were in some degree responsible for their poverty, 
and that he might help them, if he would. Undoubtedly, 
many a one in that procession deserved better things than 
had hitherto fallen to his lot, and many a wealthy man had 
passed by on the other side instead of drawing near to help his 
less fortunate brother. But unless the Lord Mayor possesses 
more of this world's goods than most people who are 
counted rich, his entire property would not purchase each 
member of that procession a respectable hat. And if the 
said Lord Mayor's property could have fallen into the 
hands of the members of the procession, an equal amount 
going to each individual, day by day, while it was being 
produced and accumulated, it would probably have amounted 

208 



THE LABORER AND THE CAPITALIST. 

to scarcely more than the cost o£ a single kernel of coffee 
to each of them. 

Think a moment ! The wealth of England is made up 
of profits resulting from her commerce with the whole world. 
It is safe to say that the trade of England has been carried 
on with an average of two hundred millions of people for 
the last three hundred years. During this time more than 
eight generations have come and gone, so that the property 
now visible on the British Isles is in no small degree the 
result of the efforts of more than three billions of people 
from first to last, the amount to each individual would be 
but a very small fraction of a cent a day, which is too 
insignificant a sum to materially effect the fortunes of any- 
body. 

Substantially the same facts obtain with regard to the 
United States. 

Our wealth is the product of more than six generations 
of Americans, together with the vast number of citizens of 
other countries with whom we have dealt for more than two 
hundred years. The amount that remains of the product 
of American labor, had it been equally divided while it 
was being produced, would not have added enough to the 
income of each individual to have supported a canary bird ; 
no, nothing near it ; it would not have bought a decent 
meal once in a year. Consider the wealth of the world, 
the length of time it has been accumulating, and the pro- 
digious number of hands that have been engaged in its 
production. If it were true that it had all been taken from 
the people wrongfully, it could have affected their condition 

209 



THE LABORER AND THE CAPITALIST. 

only as a drop o£ water affects the ocean. The amount to 
each individual is simply infinitesimal. 

It is not true, therefore, that a system of distribution 
that would turn to the many that which now goes to the 
few, would make any material difference in the hours of neces- 
sary labor, or in the power of the poor to surround them- 
selves with the necessaries or the luxuries of life. But the 
glorious truth has been abundantly proven in previous 
chapters that the possessions of the few have not been wrung 
from the many ; but that, on the contrary, the energy and 
fortunes of the few have been a priceless blessing to the 
many. As a rule, the more one hurries to get rich, the more 
rapidly he calls for hands, and, right here, is where the wage- 
earner gets his increased employment and his rise in wages. 

Let the workman consider this proposition, and then ask 
himself the questions, " Have not my opportunities been in- 
creased by the rapid accumulation of wealth in this country, 
and what would have been the present condition of labor 
without the pushing energy of the men who have won large 
fortunes or fortunes above the ordinary. 

Now, a word with regard to the statements of the New 
York World and the Times, quoted by Socialist, on pages 
75 and 76 of this work. The opinion of the World that 
henceforth it would be harder for the workingman to rise to 
a condition of independence, or to escape from the condition 
in which he was born, is absolutely refuted by the fact that 
the purchasing power of wages has already advanced con- 
siderably beyond what it was at that time, and again by the 
further fact that the increase in corporations and joint-stock 

210 



THE LABORER AND THE CAPITALIST. 

companies is rapidly multiplpng the opportunities of wage- 
earners to invest their small savings and receive a share of 
the profits of business. How can this do other than make 
the road to independence easier for the workingman ? 

Now as to the statement by the New York Times ^ that half 
of the farms were ready to be sold, and the argument by the 
Socialist, that while the farmers were being driven into ten- 
antry the capitalist had been getting into a condition where 
he could buy those farms if he would, etc., is quite as wide 
from the mark, as the statement in the World just discussed. 

At the time the farmer was hard pressed the other 
capitalists of the country were in the same condition. In- 
deed, the condition that existed in 1877 when the World 
and the Times made the statements quoted, was like that 
which existed in 1893, as for example : The force that had 
lowered the value of the farm had placed the moneyed capital- 
ist where it was harder for him to buy; even the labor 
candidate's own statement, quoted on first page of this 
chapter, that 125 banks had suspended in six months, and 
that railroads and other large corporations were failing in 
frightful numbers, proves that whatever caused the calam- 
ity, it fell upon the rich as well as upon the poor. 



CHAPTER IV. 

RECAPITULATION AKD CONCLUSION. 

Since I wrote the early chapters of this volume, in which 
I gave it as my opinion that harmony could not exist 



THE LABORER AND THE CAPITALIST. 

between laboring and capitalistic forces, while so many 
earnest people held the belief that capital was robbing labor, 
I have seen much to confirm me in that opinion. An 
unusual number of great strikes have occurred in this 
country and in Europe, including that against the Pullman 
Company. Some violence has been used, and a great deal 
threatened. Labor organizations have gained rapidly, 
while public sympathy for the working man has not 
diminished. 

I feel the weight of the fact that my theory regarding 
the distribution of wealth — which is the real bone of conten- 
tion — antagonizes the theories now being put forth, not 
only by the laboring world, but by many in the rehgious, 
literary and scientific fields as well. 

Nevertheless, as I scrutinize the preceding pages the 
behef that I am right does not weaken. And to the end 
that the opposing theories and opinions in question may be 
more conveniently analyzed by the reader, I will restate 
the substance of some of the more important, and compare 
their logic in a few pages of recapitulatory discussion. 

The feeling of the masses and the issues supposed to be 
involved, are fairly well stated by the Kev. Thomas Dixon as 
follows : 

" It is now the kingdom of money against the kingdom of the 
common people. 

" The masses are restless. 

" The classes are blind. 

*' The hour is ripe for action. 

" The issues involved are tremendous. 

212 



THE LABORER AND THE CAPITALIST. 

" What are these issues ? 

" The stake involved for the conservative forces of society cer- 
tainly includes : 

" First — The present economic order. Let the men of wealth 
and privilege understand it clearly. There can be no mistaking 
the meaning of this movement of the world's masses. The object 
of attack is the foundation of the present scheme of competitive 
society. 

" The conviction has grown so strong that it has become a prin- 
ciple of action — that the present order of society is responsible for 
the unequal distribution of wealth, the extremes of poverty and 
luxury, the opportunities for injustice and oppression, the creation 
of gigantic monopolies and the consequent impoverishment of the 
millions. They — the people — believe that if things remain as 
they are, within fifty years there will be billionaires in America. 
Right or wrong, they believe that millionairism is unjust, and that 
a billionaire would be a crime against humanity. 

" Mr. Thomas G. Shearman in his famous article in The Forum 
shows that in America three-tenths of one per cent, of the popula- 
tion control seventy per cent, of the property. In other words, in 
the distribution of national wealth one man in three hundred re- 
ceives f 70 out of every flOO, and two hundred and ninety-nine 
men receive $30, which, if averaged, would give them about ten 
cents each. The wealth of Croesus was f 8, 000, 000. This is less 
than the annual income of more than one American millionaire. 
Mr. Shearman says : ' Several non-speculative estates have increased 
five-fold in less than forty years. Counting only four per cent, 
increase, the present fortune of 1200,000,000 will become |1,000,_ 
000,000 in less than forty years.' " 

In justice to Mr. Dixon I will quote from his remarks 
directed especially to the working people. He said : 

213 



THE LABORER AND THE CAPITALIST. 

"The hour calls for the earnest and sacrificing thought of the 
workingman. His life hangs upon the movement of the next 
decade. He cannot afford to blunder. He must think. He 
must read. He must organize. He must federate. 
Your revolution must be a bloodless one to be a successful one. 
Anarchy is an insanity. It was born in the wrongs of our social 
order, but it can never cure them. 

" It is the delusion of the dethroned reason. It will destroy 
friend and foe alike if allowed the opportunity, and over the wreck 
cut its own throat. 

" In proportion as violent councils have prevailed among the lead- 
ing movements of the masses, their cause has been set back, and 
the day of emancipation postponed. You are now endowed for 
the first time with the ballot and the free use of your brains. 
Use these resistless powers." 

As I have often stated in this volume, from the laborer's 
standpoint he has a tremendous case against the capitalist. 
As he sees it, the concentration of wealth is enormous, and 
his own hard earnings are immensely in the hands of the 
rich, who are using them to oppress him. But if my the- 
ory of the lav^ of exchange and mutual dependence be cor- 
rect there has been no concentration of wealth except in a 
few individual cases, which does not, nor cannot, materially 
affect the fortunes of the masses. 

An article appeared in the New York Herald, August 
19, 1894, in which are tabulated 183 names of indi- 
viduals whom the writer says own $474,000,000 of the 
$1,562,000,000 of the red estate value of New York 
City. This article is weU calculated to have great 

314 



THE LABORER AND THE CAPITALIST. 

influence. The following are some of. the statements 
accompanying these figures : 

" One of the most interesting chapters in the history of New York 
is the manner in which the real estate of the city is being gradu- 
ally absorbed by a few wealthy residents, who are continually 
making additions to the property they have been accumulating 
for years. 

" Kesearches made by the Herald demonstrate that the number 
of small property owners and landlords is steadily diminishing. 
By the Comptroller's receipts for 1893 it is shown that of the total 
taxes on real estate, valued at ^1,562,582,393, those on property 
worth $474,085,000 were paid by 177 private individuals and 
estates. This number does not include some estates whose hold- 
ings are mainly of a leasehold character, nor properties owned by 
corporations. 

" From this it wiU be readily seen that real estate in the city is 
largely controlled by the landed gentry." 

How can the masses read these statements and not be 
convinced that it is their solemn duty to attack the present 
scheme of "competitive society"? 

Couple Mr. Shearman's statement that three-tenths of 1 
per cent, of our people own 70 per cent, of the wealth 
of the country, with the calculation quoted from the 
Herald, that 177 individuals own $474,085,000 out of 
$1,562,582,393 of the real estate wealth of New York City, 
and they appear to have a meaning which at first glance 
borders on the awful. 

But when the two propositions are put under scrutiny, 
we discover that they are absolutely valueless, so far as re- 
lates to the question of the concentration of wealth. The 

215 



THE LABORER AND THE CAPITALIST. 

data they furnish regarding the present distribution of 
wealth is compared with no data of a former period, which 
alone can determine whether wealth is concentrating or not. 
If three-tenths of 1 per cent, of the population controlled 
70 per cent, of the wealth in 1890, for example, what 
percentage of the population controlled 70 per cent, of 
the wealth in 1840, or fifty years ago ? If 177 individuals 
owned $474,000,000 of the real estate wealth of New York 
City in 1890, how much of the wealth of New York City 
did the same percentage of her population own in 1840 ? 
These questions answered, and we have positive knowledge 
regarding the great question of the concentration of wealth 
in New York City and in the country at large. 

We have no data at hand ; indeed, it would require a 
great length of time and much painstaking to obtain figures 
covering the whole country, but I feel that candid and well- 
informed minds will readily concede that if wealth has con- 
centrated anywhere, it has been in the city of New York. 
It is often said that " when a man becomes very rich he 
hies to the city." This is especially true of New York. It 
is the metropolis of the nation and the greatest natural trade 
center in the world. Its growth must be steady and per- 
manent. This, capitalists understand, and thither they go 
in large numbers with their wealth. 

There the poor go also from every clime. More than 
one-half of the population of New York City is of foreign 
birth or foreign parentage. It would seem to be quite 
natural, therefore, that with the constant inflow of the very 
poor and the very rich, one should stand out against the 

216 



THE LABORER AND THE CAPITALIST. 

other in the very strongest light. That the fortunes of the 
very rich should overbalance more and more, year after 
year, the accumulations of the very poor and the moderately 
well-to-do, is at first glance a natural conclusion. 

And, by the way, here is where the greatest difficulty 
lies in the settlement of the capital and labor controversy, 
to wit : Writers follow the impression resulting from the 
first glance. They do not search for all the elements in 
the problem. In other words, they stop short of the whole 
truth — not intentionally, as a rule — but here are huge piles 
of wealth, and near by are the poor. Rich people are more 
plentiful than formerly, and so are the indigent. Why 
reason further ? It appears plain that one is the concom- 
itant of the other, and that the few are consuming the 
goods that belong to the many. 

Thomas G. Shearman says that several non-speculative 
estates have increased five-fold in less than forty years. 
This is probably true, but without a further explanation it 
is absolutely and dangerously misleading. The natural in- 
ference is that the estates in question, together with the 
accumulations of rich individuals, are absorbing the great 
city. The Rev. Dr. Dixon has taken this view of the case 
from Mr. Shearman's statement, and thundered it forth to 
one of the largest congregations in New York City. The 
press has taken it up and spread it broadcast over the land. 
The Herald is reasoning in the same vein, and has pro- 
duced figures which, at first glance, appear to confirm not 
only the figures, but the inference natural from Mr. Shear- 
man's statement. 

217 



THE LABORER AND THE CAPITALIST. 

Now let us look to the very bottom of the question of 
the concentration of wealth in New York City. 

Accompanying the figures in the Herald is the follow- 
ing- 

" It is, of course, impossible to give a complete list of persons 

owning property in New York worth $1,000,000 or more. The 
compilation of such a table would require an accurate knowledge 
of every ownership in the city, together with the ability to appraise 
each parcel at its exact value ; and this latter, it is safe to say, no 
one man possesses. 

"An attempt to gather up the information in unofficial quarters 
must have inevitably ended in disaster. Over-estimates of value, 
mistakes as to present holders, and a thousand other errors would 
have rendered a list made up outside of the public records worth- 
less. 

**So the list given below was taken from books showing the re- 
ceipts of taxes in the office of the Comptroller. It errs only in 
that the amounts placed opposite the names are in most cases very 
much below the wealth in real estate possessed by the individuals 
and estates named. This under-estimate arises from two facts : 

' ' The Tax Commissioners of this city assess property at about 
60 per cent, of what they consider its market value to be, and 
oftentimes the valuation falls much below that figure. An en- 
deavor has been made in compiling the table to correct this. 

*'The second cause for the under-estimate is to be found in the 
practice in vogue of having the lessees of ground and houses pay 
the taxes as part of their rent. Where this is done the real owner 
of the property does not appear on the books of the Receiver of 
Taxes at all. Thus, for instance, the Astor estates have many 
tenants, from the lessees of their big hotels down to the occupants 
of their small dwellings, who pay the yearly taxes as part of their 

218 



THE LABORER AND THE CAPITALIST. 

rent. The amount of property credited to the Astors on the tax 
books and reproduced after re\asion in the accompanying table is 
therefore but a portion, though a goodly one, of their holdings. 

*' While the table does not set forth all the owners whose posses- 
sions run into seven figures, it contains the names of the great 
majority of the landed gentry in New York. The figures are ac- 
curate as far as they go, and if wealth is under-estimated, as it is 
in most cases, the change from the usual habit of exaggeration 
should be welcomed. 

'*The figures have been compiled with great care, and only after 
much labor. They show the amount of money upon which the 
land-rich pay taxes. The totals opposite each name would not 
correspond with those in the Tax Assessor's books, which are ad- 
mittedly low. The revision of these tax figures has simply been 
undertaken with a view to bringing the values in touch with cur- 
rent market quotations." 

I have copied thus lengthily from the Herald to show 
the sincerity of the author, and how well calculated the 
article is to produce a deep impression upon the commun- 
ity. But I wish to call special attention to the language of 
the fourth paragraph, to wit : 

" The Tax Commissioners of this city assess property at about 
60 per cent, of what they consider its market value to be, and 
oftentimes the valuation falls much below that figure. An en- 
deavor has been made in compiling the table to correct this." 

You see reader, the figures have been compiled with great 
care and much labor, yet the amount of property set down 
opposite each name does not correspond to the figures in the 
tax hooks. The reason given by the writer for this discrep- 
ancy is that "the revision of these tax figures has been 

219 



THE LABORER AND THE CAPITALIST. 

undertaken v/ith a view to Lrinc^ins: tlie values in touch with 
current market quotations." 

By thisj of course^ is meant that the writer has added a 
sufficient amount to the official figures to bring the value 
up to the present market price of real estate. How else 
could he manage to bring " the values " (as he expresses 
it) in touch with current market quotations. 

Therefore 40 per cent, must have been added to the 
assessed value of the property in question, since no other 
sum would bring " it in touch with current market quota- 
tions." 

But why add any sum whatever to the assessed value of 
the land of the rich without adding; the same ratio to the 
land of others, since to do so is to make a difference appear 
which really does not exist. To illustrate : 

If Jones's land is assessed at $1,000, and Hooper's at 
$500, the difference is one-haK. But if we add 40 per 
cent, to Jones's without adding any to Hooper's, the differ- 
ence appears to be nearly two-thirds. This is exactly 
what has been done (though without wrong intention, I be- 
heve) in the communication to the Herald. Now since 40 
per cent, has been added to the assessed valuation of the 
real estate of the very rich, and nothing to that of others, 
we will strike out that 40 per cent. All the real estate 
will then stand assessed at 60 per cent, of its market value, 
and we have a basis for calculating the difference in the 
value of the real estate holdings of the very rich and that 
of their neio:hbors. 

When this reduction is made, $284,451,000 represents 

220 



THE LABORER AND THE CAPITALIST. 

the true sum for comparison. The Herald reporter in ref- 
erence to the Astor holdings says : " The amount of prop- 
erty credited to the Astors on the tax books, and reproduced 
after revision in the accompanying table, is therefore but a 
portion, though a goodly one, of their holdings." 

Let us take it for granted that the table in question rep- 
resents not all, but a very large majority of the real estate 
holdings of what the compiler calls the landed gentry of 
New York City. We will say the same, and apply the same 
rule to the individuals representing the landed gentry of 
New York City in 1840. I have gone through the tax 
books of that year in a very cursory manner. A goodly 
number of the names which appear in the tax books I did 
not trace through more than eleven of the seventeen wards 
which constituted the city at that time. The names of 
property-holders were not alphabetically arranged in the 
tax books of those days, consequently the labor of tracing 
an individual name through seventeen volumes so as to find 
the full amount of his taxable property is very great. I went 
far enough, however, to become convinced that the real 
estate of New York City was very much more concentrated 
in 1840 than it is at the present time. 

To illustrate : I found twenty-five names and estates as- 
sessed for $32,000,000 of real estate. These twenty-five 
individuals and estates then owned about 18 per cent, 
of the assessed value of the real estate of the whole city, 
which at that time was $174,000,000. 

In 1894 the assessed valuation of the real estate of the 
whole city was $1,562,582,393. The compiler of the 

221 



THE LABORER AND THE CAPITALIST. 

figures in the Herald says tliat 177 individuals and estates 
own $474,085,000 of this amount, but I find that instead 
of 177 names and estates, 183 are tabulated in that com- 
munication, and their wealth all computed to make the 
total claimed. 

Then I find, as before shown, that the compiler has added 
40 per cent, to the larger holdings and nothing to the 
smaller. 

Let us base our calculation upon the assessed valuation 
of all, which is as fair for one class as for the other. The 
result will then be that in 1894, 183 individuals and estates 
were worth $284,451,000 of the assessed value of the real 
estate of the city, which amounts to about 18 per cent, 
of the whole. 

The fact then is, that twenty-five individuals and estates 
owned as much of the real estate of the city of New York 
in 1840 as 183 own at the present time, or in 1894. 

The population of New York City was 312,710 in 1840, 
and 1,891,306 in 1894. 

The assessed value of the real estate of the city in 1840 
amounted to about $550 for each resident. Therefore, the 
$1,280,000, which was the average wealth of the aforesaid 
larger holders in those days, was equal to that of about 
2,327 of the smaller holders. 

In 1894 the assessed value of the real estate amounted to 
about $825 to each resident; therefore, the $1,554,000, 
which is the average real estate wealth of the aforesaid 183 
larger holders at the present time, is only equal to that 
of about 1,883 of the smaller. 

222 



THE LABORER AND THE CAPITALIST. 

That is, while each o£ the larger holders of 1894 are able 
to purchase the holdings of only 1,883 of the smaller, each 
of the larger holders of 1840 were able to purchase the hold- 
ings of 2,327. Difference, 444. 

These figures do not accurately represent the relative 
value of the larger and smaller estates and holdings of 1840 
and those of 1894, but they approximate it, and, therefore, 
have a very important meaning. 

The fact that twenty-five individuals and estates owned 
a larger proportion of the city of New York in 1840 than 
a proportionate number of the present population own ; in 
other words, it being true that each of the larger real estate 
holders of 1840 could have bought the real estate possessions 
of 444 more of their neio^hbors than each of the 183 of the 
present larger holders can buy, proves that the real estate 
wealth of the great city is more evenly distributed at the 
present time than it was fifty years ago. 

Let us suppose that Mr. Shearman's estimate as quoted 
by Mr. Dixon is correct, and that " several of the non-spec- 
ulative estates have increased five-fold in less than forty 
years." What of it? 

Suppose the entire 183 individual holdings and estates 
reported in the Herald to have increase five-fold in forty 
years. Does that prove that the few are absorbing the real 
estate wealth of the city? Not at all. For the all-im- 
portant and all-sufficient reason, that while the value of 
the individual property and estates in question has in- 
creased about five-fold the wealth of the city has increased 
about nine-fold. So that instead of it beino^ true that 

223 



THE LABORER AND THE CAPITALIST. 

a few wealthy residents are absorbing the real estate of 
the city, the increase in the value of their possessions is 
not keeping pace with the increase in the value of the 
whole by nearly one-half. How many years will it require 
for the few to absorb the many at this relative rate of in- 
crease ? 

And what is true of New York City, is true of the country 
generaUy. In 1792 General Washington's property, of a 
little less than $1,000,000, was equal to the property of a 
larger percentage of the people ; and Washington could have 
purchased the possessions of more Virginians at that time 
than any five residents of the same State can purchase at 
the present time. What Washington's million could have 
accomplished in Virginia when he lived Girard's $9,000,000 
could have accompUshed in Pennsylvania in 1840. 

In 1848 John Jacob Astor's $25,000,000 was a larger 
slice of the nation's wealth, and he could have purchased 
the possessions of a much larger percentage of the popula- 
tion of the country than John D. Rockefeller or any other 
rich American can purchase at the present time, and that, 
too, if we place the property of our wealthier citizens at the 
very highest popular estimate, which is unquestionably far 
above the true figure. These facts cannot be disputed. They 
are mathematical conclusions. The per capita wealth and 
the valuations of property as they appear in the census report 
is a demonstration of the truth of the aforesaid proposition. 

Now let us turn again to the statement of the Rev. 
Thomas Dixon, based upon the figures of Thomas G. Shear- 
man. He says : "In the distribution of national wealth 

224 



THE LABORER AND THE CAPITALIST. 

one man in three hundred receives |70 out of every $100, 
while two hundred and ninety-nine men receive only |30, 
which, if averaged, would amoimt to about ten cents each." 

Now, instead of it being true that $70 go to the few, 
while only $30 go to the many, very much more than $70 
go to the many, while very much less than $30 go to 
the few. 

A statistical statement by H. V. Poor, concerning the in- 
come of railroads, is a good illustration of how small a per- 
centage of income from business lodges in the hands of the 
few. See " Poor's Manual for the Railroads " for 1887, as 
follows : 

" The rate per ton per mile for all the roads in the United States 
for 1865 equaled 3.06 cents, assuming the average rate of all to 
be that of the thirteen roads taken as representative lines. Had 
such rate been charged in 1887, the earnings of all from freight 
would have equaled 81,213,214,727 greater than the amount 
actually received. . . . An addition of one mill per ton per 
mile upon the movement of 1887 would have increased the earn- 
ings from freight by more than 160,000,000." 

These two propositions, by the distinguished railroad 
statistician, are full of meaning. They absolutely annihilate 
the theory that the larger proportion of the income from 
corporations and heavy business concerns (Monopolies as 
they are called) lodges in the hands of a few. If the addi- 
tion of one mill per mile on each ton of freight moved by 
the railroads would increase the income of the corporations 
more than $60,000,000 in a single y6ar, the addition of 
two mills per mile, would, of course, increase the income 

225 



THE LABORER AND THE CAPITALIST. 

of the railroads more than 1 120,000,000 per annum, which 
is more than the net profit of all the railroads of the United 
States. 

It is demonstrated, therefore, that when the railroads 
charged three cents per mile for moving freight there re- 
mained permanently in their own hands less than two-tenths 
of one cent. ^ 

In other words, out of every $30 earned by the railroads 
$2 went to the few and $28 to the many. 

Now for the other proposition by Mr. Poor, to wit : The 
difference in the cost of freight in 1865 and in 1887 reached 
a total of more than $1,200,000,000 in a single year. But 
let us assume that the average difference since 1865 has 
been only $500,000,000 per annum. The saving to the 
people has therefore been about $15,000,000,000, a sum 
larger by 50 per cent, than the present wealth of all the 
railroads in the United States. 

What is true of railroads is true of corporations and large 
aggregations of wealth employed in the multitudinous bus- 
iness enterprises of the country. They are pouring wealth 
into the pockets of the many and increasing the opportun- 
ities of the masses to improve their condition. 

It will be remembered that the compiler of the figures 
in the Herald said in substance that his estimate did not 
include corporations, but that it did include most of the 
larger estates. The inference natural from his statement 
is, that had he included corporations, the enormous concen- 
tration of wealth would have been all the more apparent. 
Let us see. 

226 



THE LABORER AND THE CAPITALIST. 

Had he considered banking corporations, for example, 
he would have found the number in the whole city to be 
one hundred and thirty-one. These are great moneyed in- 
stitutions, but they are owned by 19,994 individuals — one 
hundred and fifty-two to each bank. That is, 19,994 indi- 
viduals have come together and agreed to loan money to 
the people. This is not a concentration of wealth in the 
hands of a few. It is a combination of capital for busi- 
ness purposes. It is nothing more nor less than a co-oper- 
ative association. 

Had the writer for the Herald seen fit to have included 
corporations other than banks in his table he would have 
found in the whole city 1,387. Assuming the number of 
shareholders for each of these corporations to correspond 
to the number of shareholders for each bank (one hundred 
and fifty-two), the total number of shareholders in the 1,387 
corporations would be 210,814, which, added to the 19,994 
bank owners, makes a total of 230,808 owners for the 1,518 
corporations. Is this a concentration of wealth ? 

Now for the estates ! 

Of the 183 holdings tabulated in the Herald, 63 are 
estates. Some of them are quite large ; but can it be truly 
said that these estates represent wealth concentrating in the 
hands of a few? On the contrary, they are wealth dis- 
tributing among the many. To illustrate : 

While the Astors have multiplied less rapidly than most 
families have, there are, nevertheless, more than fifty heirs 
to the estate. So that if the value of their whole property 
be reaUy up to the popular estimate, the Astors are practi- 

227 



THE LABORER AND THE CAPITALIST. 

cally worth little more than a milhon dollars each. And, 
comparatively speaking, that is, in power to purchase the 
holdings of neighbors, great and small, the richest Astor of 
to-day is no approach to the Astor of 1848. 

If it be assumed that each of the other 62 estates tabulated 
by the Herald has as large an heirship as the Astors, they 
are practically the property of 3,100 individuals, whose 
average share of the estates in question falls below twenty 
thousand dollars. 

How much more widely then, is the wealth of these es- 
tates distributed than it was when the death of those who 
first controlled them took place. 

An All-wise Creator has made it natural for wealth to ac- 
cumulate, and He has made it just as natural for wealth to 
scatter. Up and down and over the earth constantly travels 
the grim and irresistible messenger — Death. He strikes 
down rich and poor alike, and divides their hoards, great 
and small, among the living. 

The wealth of the original Yanderbilt has been divided 
into about eighty parts. In twenty-five or thirty years the 
same great Leveler will subdivide it many times ; and in 
half a century the colossal fortune of Cornehus Yanderbilt 
will be known only in history. 

The same will be true of most of the other large fortunes 
of to-day. Nevertheless, more will come into existence, 
serve their purpose, and follow those that have preceded 
them as one generation follows another. 



228 



THE LABORER AND THE CAPITALIST. 



CHAPTER V. 

A NEW BOOK. 

I had thought to let this volume close with the preced- 
ing chapter, but my attention has just been called to a new 
publication, the character and method of which has deter- 
mined me to write the following criticism. The publication 
referred to is written by Prof. Charles B. Spahr, and bears 
the title, " The Present Distribution of Wealth in the 
United States." It is one of twelve works on Political 
Economy published by the Library of Economics and Poli- 
tics, edited by Richard T. Ely, Ph.D., LL.D., Professor of 
Pohtical Economy and Director of the School of Economics, 
Political Science and History in the University of Wiscon- 
sin. Dr. Spahr has been employed by Columbia and other 
institutions of learning to lecture upon the general subject 
of Political Science. A book coming from so responsible a 
source will of course attract public attention. I notice that 
Dr. Spahr is lengthily and confidingly quoted in a goodly 
number of recent publications. In fact the work has 
been brought prominently before the country by a dis- 
tinguished Republican senator (see Hon. Wm. E. Chandler's 
speech. Congressional Record, February 16, 1897, page 
1,984), as follows : 

" The writer of a recent essay on ' The Present Distribution of 
Wealth in the United States,' Prof. Chas. B. Spahr, sums up his 
conclusions as follows : There is constantly going forward in this 

229 



THE LABORER AND THE CAPITALIST. 

country a concentration of wealth in the cities to the impoverishment 
of the country districts, and that in the cities there are forces con- 
stantly working toward a yet narrower concentration of wealth — as 
much more concentrated as it is greater than the wealth in the coun- 
try. He asserts that, taking the whole country, the great body of the 
small property holders, embracing seven-eighths of the property- 
holding families, hold of the national wealth only one-eighth, while 
the wealthy classes hold five-eighths ; that one family out of every 
hundred holds as much wealth as the other ninety-nine ; that the 
average wealth of the families in the country districts is |3,250, 
while in the cities it is $9,000 ; but that the wealth of the East, 
including foreign holdings, with but 30 per cent, of the popula- 
tion of the country, amounts to thirty-one thousand five hundred 
millions of doUars, while the wealth of the West and the South, 
with 70 per cent, of the population, is thirty-three thousand five 
hundred millions. He says, in connection with incomes, that two- 
fifths of the product of industry goes to capital ; that one-tenth of 
the families have as much income as the nine-tenths ; that 1 per 
cent, of the families, the richest, at the top, have as much income 
as the 50 per cent., the poorest, at the bottom. In other words, 
that one-eighth of the families have more than one-half of the 
whole income of the people. ... If these conclusions are to 
be relied upon — and they are carefully set forth and gravely de- 
fended — while it may not be patriotic to appeal for the votes of 
the poor against the rich, yet it will certainly be wise for the gov- 
erning classes of this country to devote themselves, in hard and 
distressing times, to the alleviation of the burdens of the poorer 
classes." 

The nature and drift of Dr. Spahr's work is sufficiently 
explained in the f oreg^oing remarks of Senator Chandler, 
and the power of his arguments is well attested by the fact 

230 



THE LABORER AND THE CAPITALIST. 

that the Senator's practical indorsement of them before the 
highest legislative body in America called forth no protest 
from the distinguished Senators and economists who were 
present. AU of which goes to confirm my earlier position 
that the belief that the results of a common industrial ef- 
fort are centering more and more in the hands of a few 
permeates all classes of society, legislative bodies not ex- 
cepted. I will pave the way to an analysis of some of 
Dr. Spahr's leading arguments by quoting the preface to 
his book, which reads as follows : 

" This volume is written chiefly for the instruction of the in- 
structed classes. The conclusions reached respecting the present 
distribution of property and incomes are in the main those which 
common observation has forced upon thoughtful men and women 
in the ordinary walks of life. The wi^iter has learned^ and 
lioj)es to teacJi^ ihat^ upon matters coming within its fields the 
common observation of common people is more trustworthy than 
the statistical investigations of the most unprejudiced experts. 
Indeed he has come to believe that social statistics are only trust- 
worthy tvhen they show to the world at large what common obser- 
vation shows to those persons familiar with the conditions 
described. ^^ 

Dr. Spahr has written his book under the conviction 
that, to use his own words, " the common observation of 
the common people is more trustworthy than the statistical 
investigations of the most unprejudiced experts." 

No considerate mind will question the value of common 
observation, but how frequently we find it at fault. As, 
for example, the common observation of the older class of 

231 



THE LABORER AND THE CAPITALIST. 

the community, and indeed of all classes, is that human 
life averages less years now than it did in the days of 
plainer living, simpler tastes, fewer factories, and the more 
vigorous outdoor exercise of a hundred years ago, yet our vital 
statistics compel us to admit that the very opposite is true. 

Common observation would lead us to believe that our 
globe is flat, and that the sun travels around the earth in- 
stead of the earth around the sun, but the tremendous 
reach of the telescope, the science and skill of the mathe- 
matician, and the carefully prepared figures of the astrono- 
mer force us to a different conclusion. 

More or less failures have taken place every day 
from time immemorial. At some periods they have come 
upon the business world like an avalanche ; one following 
the other so swiftly that the community has stood aghast 
and somebody — probably reckoning from common observa- 
tion data — started the story that these failures amounted to 
95 per cent, of all who engaged in business, and the world 
has so believed for many many years. But the Bradstreet 
Commercial Agency (see page 2, Bradstreet's Commercial 
Eeport, 1895) instituted a statistical investigation, requiring, 
to use their own words, the examination and re-examination 
of more than 1,300,000 individual firms and corporations 
throughout the country repeatedly, and the service of more 
than 125,000 correspondents at 78,809 cities, towns, and 
postoffices in the United States and Canada, and from this 
investigation we learn, to our very great surprise, that, of 
all who have entered business, the percentage of failures 
has only been about one-third of what we had supposed it 

232 



THE LABORER AND THE CAPITALIST. 

to be, to wit — 30 instead of 95 per cent. In other words, 
a careful statistical investigation has demonstrated, that, re- 
garding the percentage of failures to the number of per- 
sons entering business, common observation has been 
about 60 per cent, wrong, and might have remained so 
through all time, for aught we know, had not a statistical 
investigation dispelled the illusion. 

While I drew my conclusions from common observation, 
I believed that the door of advancement was being closed 
in the face of the poor. I looked upon the costly struc- 
tures in our large cities, for example, as wealth piled up to 
some day menace liberty, if, indeed, it was not already doing 
so. So far as I could gather, from glancing around, so to 
speak, the wealth of the country was concentrating in the 
hands of a few, but a careful statistical investigation made 
me know that " the common observation " of myself and 
the rest of the common people regarding the distribution 
of wealth was absolutely wrong. 

All this has not made other important questions — cur- 
rency, tariff, etc. — appear any the less important. But I 
have come to think that the question of the distribution of 
wealth and the true relation of the laborer and the capital- 
ist, and the part each is performing in the work of life and 
the forward movement of the race, needs to be better under- 
stood, before an unprejudiced discussion can be had upon 
any other economic subject of great and general import- 
ance. And I must say, in all candor, that books written 
by men of unquestionable ability and integrity, but who 
assume certain premises to be correct, and as I have said 

233 



THE LABORER AND THE CAPITALIST. 

in the first chapter of this work, conscientiously disregard, 
or pass Hghtly over, so many facts, which a more search- 
ing analysis would show to be truths of tremendous im- 
portance, even vital, are great hindrances to a speedy and 
amicable settlement of the main differences between the 
laborer and the capitalist. 

Dr. Spahr does not dispense with statistics by any means ; 
indeed, he quotes them freely when they suit his side of 
the case, but ignores or dismisses them very unceremoni- 
ously when they do not support popular opinion, or, to use 
his own words, "when they do not show to the world 
what common observation shows," etc. I can but feel that 
through this behef dominating Dr. Spahr's mind, he has 
reasoned so loosely, and drawn conclusions from data so in- 
complete and untrustworthy, as to render his elaborate essay 
worse than valueless as an economic work. This is strong 
language to use against an authority so lately cited by a dis- 
tinguished legislator before a Senate that seemed not to ques- 
tion the conclusions quoted. Nevertheless let us examine : — 
When I discussed the savings banks, on pages 173-4-5 of 
this work, I felt that I had illustrated an encouraging, but 
not generally understood, truth regarding the power of the 
thrifty toiler to save. And also did I feel that the savings- 
bank statistics there tabulated were a complete refutation 
of the theory advanced by Dr. Strong, whose argimients I 
was then criticising. Why was I not right ? The number 
and aggregate amount of savings bank accounts are increas- 
ing much more rapidly than the nimiber of very rich peo- 
ple or the percentage of their wealth. This being true, 

234- 



THE LABORER AND THE CAPITALIST. 

now can it be said that the rich are getting a larger and 
larger share of the national income ? However, here we 
encounter one of Dr. Spahr's leading arguments, which he 
introduces early in his essay. See page 58 of his work, as 
follows : — " The conclusions reached by the Massachusetts 
Labor Bureau, under General Oliver, are incontrovertible. 
Great as are the benefits conferred by the savings banks 
upon the more thrifty wage-earners, the bulk of the de- 
posits belong to a comparatively small class of the rich 
and well-to-do citizens.'* 

Here I find a foot-note referring to a report by the Labor 
Bureau of Massachusetts for 1872-3, in which Dr. Spahr 
writes as follows : 

" The conclusions especially indorsed are the following (Report 
1873, p. 228): 1. That persons not wage-earners are depositors 
to at least one-half of the total amount deposited. 2. That, as a 
rule, wage labor deposits average under f50 at one time. 3. 
Manufacturers, traders, and lawyers use these banks instead of 
banks of deposit. 4. That capitalists, persons living on their in- 
comes, use these banks to escape taxation and the care necessi- 
tated by other investments." 

To these statements Dr. Spahr appends the following : 

"The deposits made (at onetime) in ninety savings banks were 
classified as follows : " 
Deposits under -$50 at one time, . . . 167,601 

Aggregate, $3,375,379 

Deposits between $50 and $300 at one time, . 70,002 

Aggregate, $8,597,877 

Deposits over $300 at one time, . • . . 16,426 

Aggregate, $11,793,256'' 

235 



THE LABORER AND THE CAPITALIST. 

Dr. Spahr thinks the money deposited in savings banks by 
the rich and well-to-do classes amounts to more than one- 
half of the whole, and he has submitted the table just 
quoted as proof ; the argument being, of course, that the 
wage-earner and the common people cannot possibly com- 
mand such large sums as are there shown to have been de- 
posited at one time. Let us inquire. 

The reader will observe, if he analyzes the table, that the 
$3,375,379 deposited by 167,601 persons amounted to an 
average of $20.13 to each depositor. The $8,597,877 de- 
posited by 70,002 persons amounted to an average of 
$122.80 to each depositor. The $11,973,256 deposited by 
16,426 persons amounted to an average of $728 to each 
depositor. In other words, speaking in round numbers, 
167,000 individuals deposited less than $50 at one time, 
70,000 individuals deposited between $50 and $300 at one 
time, while only 16,000 individuals deposited more than 
$300 at one time. 

During a recent conversation with a real estate 
dealer he pointed out a beautiful ridge of land where 
upward of a hundred lots had been surveyed and sold. 
Of these lots a very large majority were bought a few 
years ago by poor men. In fact, the agent stated that 
more than 90 out of 103 had been sold to poor and com- 
paratively poor people; some of them clerks, but wage- 
workers nevertheless. A few had built upon their land, 
while others had sold at an advance. 

It is not uncommon for a poor man to purchase a lot for 
from one to three hundred dollars, pay for it in weekly or 

236 



THE LABORER AND THE CAPITALIST. 

monthly installments, and sell it for from five hundred to a 
thousand at the end of five years, more or less. 

Therefore, we see that a great many wage-earners neces- 
sarily have $300 and a $1,000 or more to deposit in sav- 
ings banks at one time. Again, consider how few of these 
larger deposits are required to make up the proportion tabu- 
lated by Dr. Spahr, there being in round numbers only six- 
teen thousand of the larger, against two hundred and thirty- 
seven thousand of the smaller. 

Dr. Spahr says that manufacturers, traders, and lawyers 
use the savings banks. If there is a grain of truth in 
this, it is a very small one. The amounts deposited, even 
the larger class, average altogether too small to indicate 
any considerable use of the savings banks by the rich, 
whether they be manufacturers, traders, lawyers, or what 
not. 

So far as manufacturers, traders, and lawyers use the 
savings banks, they are very generally of the poorer classes ; 
and these probably own a great majority of the larger one- 
time deposits. In the hne of manufacturers may be men- 
tioned such persons as custom shoemakers, tailors, milliners, 
harness-makers, men engaged in cabinet-making in a small 
way, etc., who either work alone or employ a hand or tvfo. 
There are of these a great many. They are found all 
through our cities and towns. They probably occupy a 
greater number of small business places than the rich oc- 
cupy of the larger. They are a thrifty, intelligent class of 
people; most of them are comparatively poor, some are 
poorer than many of the wage-earners. Nevertheless, as a 

237 



THE LABORER AND THE CAPITALIST. 

rule, they aspire to independence; some to large fortunes. 
It will not be denied that a goodly number of these people, 
if not already paying for a home^ are saving money for that 
purpose. As a class they are sure to use the savings banks, 
more or less. 

Then consider the poorer class of traders, shop-keepers, 
people who buy and sell goods on a small scale. The busi- 
ness places occupied by these trading, and in a sense 
speculative, men and women, probably equal the larger in 
the point of numbers ; at any rate, there are a great many 
of them; and all that has been said of the small manu- 
facturers can be as truthfully said of the small traders. 
They are, as a rule, intelligent and thrifty ; they are edu- 
cating their children, accumulating property, and hopefully 
aspiring to larger quarters and a more extensive business. 
In short, they are where most of our distinguished business 
men were twenty or thirty years ago. Couple these with 
the small manufacturers already described, and we have 
two large classes of people whose savings-bank deposits are 
not confined to fifty, three hundred, nor even a thousand 
dollars. And how few of these people need to deposit 
above $300, or as high as $728, to equal the number of 
larger one-time deposits held by the savings banks. 

Then consider the lawyers. Eich lawyers may have de- 
posited money in savings banks, but that they have done 
so to any considerable extent is not true, as we shall see 
further on. The lawyers who patronize the savings banks 
are generally of the younger class, many of whom have 
struggled through college, largely on their own earnings 

238 



THE LABORER AND THE CAPITALIST. 

derived from teaching, clerking, and the like. Of the more 
than fifty thousand towns and cities in the United States, 
there are very few that do not contain at least one of this 
class of lawyers, and the larger cities have a great many of 
them. Not a few of these men have a home or some other 
property in view which they wish to purchase, and they are 
saving money for that purpose. One conducts a law suit, 
for example, wins his case, and a hundred or a thousand 
dollars, more or less, is the pecuniary reward, and the sav- 
ings bank is generally the first receptacle. 

Now, when we consider the great number constituting 
the three classes just described, to wit, the small manufac- 
turers, the small traders, the younger and poorer lawyers, 
and consider the nature of their business transactions, 
the sums of money they are liable to handle, and, in fact, 
are known to handle, is it not a rational presumption that 
they are capable of depositing, and, indeed, have deposited, 
the bulk of the larger one-time deposits in the savings 
banks ? 

But fortunately for the great principle involved in the 
savings bank question, we are not obliged to dismiss this 
subject without more reliable evidence. There is expert 
testimony at hand, which ought to settle the question as to 
vJio owns the bulk of savings bank deposits. I refer to the 
testimony of bank managers. Should you ask a savings 
bank of&cer : Who owns the bulk of money in your bank ?, 
his answer would be, the poor and comparatively poor. 

If you ask how he accounts for so many large one-time 
deposits, he will ask what you mean by so many large one- 

239 



THE LABORER AND THE CAPITALIST. 

time deposits, since the records show that only about six 
persons have deposited about $300 at one time, while 
about ninety-four persons have deposited from f 300 down. 

Again the banker will tell you that a goodly number of 
his larger one-time deposits result from deaths in families 
where the husband, or the wife, or both, have been deposi- 
tors, and at the same time carried a life insurance policy. 
The decease of either of these naturally brings one of the 
larger one-time deposits to the savings bank. 

Again, owing to statutory restrictions placed upon 
savings banks, those institutions do not want rich people's 
money. The statutes of the State of New York, for 
example, forbid the savings banks to pay interest on 
sums abov^e $3,000 deposited by one person, whether 
said sum be deposited in larger or smaller amounts. The 
Bowery Savings Bank, which, by the way, holds the 
largest amount of money in deposit of any savings bank 
in New York, or in the world, for that matter, refuses to 
receive above $500 in one year from any one person. The 
savings banks are very much restricted in their operations, 
and their existence depends upon their complying with the 
statutes. In the first place, they are forbidden to purchase 
the bonds of any state which has within the last ten years 
defaulted on any part of its indebtedness. And even the 
best of improved real estate cannot be received by savings 
banks as security for loans at more than 50 per cent, of 
its market value, and unimproved real estate at not more 
than 40 per cent. 

Then, too, the savings banks are not allowed to hold a cash 

240 



THE LABORER AND THE CAPITALIST. 

surplus of more than 10 per cent. (I am referring to the 
New York savings banks) ; that is, they must keep their 
money loaned out so as not to have more than 10 per cent, 
of the total deposits remaining in bank. Thus it is seen 
that the kind of security they are obliged to seek, and the 
necessity of keeping their money loaned, compel the 
savings banks to exercise great care in receiving deposits. 
Remove these restrictions, and savings banks would very 
soon become commercial institutions like other banks. 

The leading facts regarding the banks in question were 
concisely stated by a controlhng of&cer in one of the New 
York savings institutions, when he spoke to me substantially 
as follows : 

" I do not doubt that rich people have some money scattered in 
savings institutions. They sometimes deposit under names other 
than their own ; but we have all we can do to loan what money 
the poor people deposit with us on such security as the law com- 
pels us to demand. If we were to allow the rich to deposit their 
surplus money in our banks, it would very soon render it impos- 
sible for us to pay such rates of interest as would make it desir- 
able to deposit money with us. Thus, you see, we do not want 
the rich and the rich do not want us." 

The facts I have here set forth, regarding the ownership of 
savings bank deposits, are corroborated by the very best 
authorities in New York and Brooklyn; among which 
are : 

The East River Savings Institution, chartered 1848. Amount 
due depositors January 1, 1897, 112,540,814.10. 

The Dime Savings Bank of Brooklyn. Amount due depositors 
January 1, 1897, 121,772,848.17. 

241 



THE LABORER AND THE CAPITALIST. 

The Brooklyn Savings Bank, incorporated 1827. Amount due 
depositors July 1, 1896, $30,339,066.39. 

The German Savings Bank, New York, opened July 1, 1859. 
Amount due depositors July 1, 1896, 137,025,309.84. 

The Immigrant Industrial Savings Bank, New York. Amount 
due depositors January 1, 1896, 149,649,731.86. 

The Bank for Savings, New York, chartered 1819. Amount 
due depositors January 1, 1896, 151,254,883.10. 

The Bowery Savings Bank, New York, chartered 1834. 
Amount due depositors January 1, 1897, $57,556,106.66. 

In conversing with an officer in one of these institutions 
regarding the fact that rich men are apt to give their wives, 
daughters, and sons pin money, so to speak, sometimes a hun- 
dred dollars, sometimes a thousand or more, and that the 
recipients are likely to deposit these sums in savings banks, 
where they will draw interest for a time, the bankers admitted 
that such was the case, but said that the sum total of such 
deposits amounted to very little, when compared to the total 
deposits coming from other sources. To the question, " Is 
it not possible that one-fourth of the sum total of savings 
bank deposits belongs to the rich and weU-to-do classes ?," the 
general and prompt reply was, " No, not one-tenth." One 
banker said it might be possible that one-fourth of the de- 
posits of some savings banks belonged to the rich and well- 
to-do classes, but that he had never known of such an 
instance. He thought that one-tenth would more than 
cover the average amount of savings bank deposits owned 
by the rich and well-to-do. 

Therefore as regards the ownership of moneys deposited 
in savings banks I can but regard Dr. Spahr's position as 

242 



THE LABORER AND THE CAPITALIST. 

absolutely demolished by facts showing that there are plenty 
o£ people capable of making and likely to make the larger 
one-time deposits without crediting the bulk, or any con- 
siderable amount, to the rich ; and again by the restrictions 
under which savings banks exist and are compelled to do 
business. And last, but not least, is Dr. Spahr's position 
overthrown by the expert testimony of disinterested wit- 
nesses — those who have direct knowledge concerning the 
matter in dispute^ — in fact, the only persons absolutely 
qualified to testify in the case. I refer to savings bank 
oJB&cers, who have nothing to gain, pecuniarily or otherwise, 
by suppressing or misrepresenting the facts. 



CHAPTER VI. 

SURROGATE ARGUMENT. 

Dr. Spahr does not rest his case against our savings 
bank theory with his larger one-time deposit argument; 
far from it ; he produces Surrogate Court records and he 
makes them count more for his side than all the rest of his 
data. In fact, if the Surrogate Court argument was 
stricken from Dr. Spahr's essay, the strongest prop would 
be gone from one of the most skillfully written and danger- 
ously misleading books I have ever read. I use the word 
" dangerously " because a book emanating from such a source 
that furnishes unusually plausible argument in support of 
the theory that an exceptionally powerful class of citizens are 
receiving a share of the general income which is out of all 

243 



THE LABORER AND THE CAPITALIST. 

honest and safe proportion to the benefits the public are re- 
ceiving from them, can but inflame the public mind more 
or less, however scholarly and pleasantly such book may 
be written. 

It cannot be said of Dr. Spahr, however, that he makes the 
sHghtest effort to incite disorder. He simply writes like one 
deeply impressed with the justice of his cause, and supports 
his common observation theory with data which those who 
have not studied the subject searchingly (and that means a 
large majority of the people), will regard as perfect proof 
of the soundness of his position ; hence the danger of his 
book. The data to which I refer, are of course, the Surro- 
gate Court reports. On pages 57-8, after stating that two- 
thirds of the families in New York City are without prop- 
erty, Dr. Spahr writes as follows : 

" This conclusion, though it is that which conmion observation 
has forced upon every one familiar with the east side of New York, 
shows how utterly fallacious is the savings bank argument, so fre- 
quently employed by conservative statesmen and economists. In 
Neio York City the number of savings hanh accounts is nearly 
twice as great as the number of families. Generally speaking^ 
every savings bank account must pass through the Surrogate 
Court on the death of its owner ^ yet two-thirds of the families 
not only possess no savings bank account^ but no registered 
property of any description^'' 

On page ^^ of his work Dr. Spahr says he selected 
three months, ending December, 1892, and procured re- 
ports for those months from the clerks of the Surrogate 
Courts in various parts of the State of New York. And 

244 



THE LABORER AND THE CAPITALIST. 

on page 56, he refers to what took place in New York City 
within that time as follows ; 

" During the three months 2,500 men over twenty-five years of 
age died. If they owned any registered personalty, even the 
smallest amount in a savings hank, their estates had to pass 
through the Surrogate's Court before reaching the heirs. Yet, 
the whole number of estates entered was less than one thousand, 
and the whole number of estates left by males was barely six hun- 
dred. In other words, only one-fourth of the men who died left any 
property whatever, except their clothing and household furniture." 

What can be more convincing to the general public than 
the Surrogate records, as Dr. Spahr has presented them ? 
The average reader will reason that while a man is still 
alive he may quibble about his wealth, or conceal the facts 
to escape taxation, etc., but that after death has overtaken 
him an inventory of his effects takes place, and his savings 
bank account, if he has any, must pass to the heirs through 
the Surrogate courts ; and that the number and amount of 
the accounts there found upon the records must indicate 
the number and amount of the accounts remaining among 
the people, precisely as the number and amount of the es- 
tates there recorded might be supposed to indicate the 
number and amount of the estates remaining among the 
people. There can be no mistaking the author's meaning. 
He intends to have his readers feel that substantially all 
savings bank accounts of deceased persons reach the heirs 
through the Surrogate courts, and that said savings do not 
exist among the masses in any such sum or sums as appear 
to be indicated by the bank and government reports, 

245 



THE LABORER AND THE CAPITALIST^ 

Does Dr. Spahr doubt the existence of savings bank ac- 
counts as reported by the banks and by the government ? 
What object have the officers of banks in reporting the 
names^ residences, etc., and crediting sums of money to 
persons who have not deposited it in the bank ? And why 
should the bank commissioner, an officer of the State, and 
the government statistician, report accounts that do not 
exist ? People may, and will, draw such conclusions from 
the number and amount of savings bank deposits reported, 
as their varying judgment and meager knowledge of facts 
and circumstances may dictate ; but as to the number and 
total amount of savings bank accounts the official reports 
can no more be questioned than the number and location 
of the banks themselves can be questioned. It must be, 
therefore, that if Dr. Spahr's investigation of the Surrogate 
books of New York City has not revealed a sufficient num- 
ber of savings bank accounts to justify the behef that such 
accounts exist among the people, both in number and in 
amount according to the reports, there must be some reason 
or reasons for it, which he has either overlooked or does not 
understand. 

Let us look into the matter. 

In the first place Dr. Spahr has confined his figures to 
persons over twenty-five years of age, and whoever will 
stop to think must know that thousands and hundreds of 
thousands of savings bank deposits are made by people 
under twenty-five years of age. We also know that more 
or less of these people die. Yet Dr. Spahr has entirely 
omitted them from his hstj he passed them by when he 

246 



THE LABORER AND THE CAPITALIST. 

canvassed the Surrogate records for inventoried estates. 

One reason, then, why he found so few savings-bank ac- 
counts passing through the Surrogate Courts in New York 
City was because he took no note of those who, taken 
together, probably constitute a larger number than any 
other one class of savings-bank depositors, to wit : Persons 
under twenty-five years of age. 

Again, no one pretends, or at least no one ought to pre- 
tend, that New York City people alone have savings-bank 
accounts numbering nearly two to each family. Tens of 
thousands of the savings-bank accounts in New York City 
belong to people Kving in outside districts, who would 
rather risk their savings in the older and larger banks of 
New York City than in the newer and smaller institutions 
in their own neighborhood. 

Of course, the estates of these people are never probated 
in New York City. Here, then, is another powerful reason 
why Dr. Spahr found so few savings-bank accounts upon 
the Surrogate records of New York City. 

Again, the savings-bank accounts that appear upon the 
Surrogate records of New York City cannot be taken to 
indicate even the number or amount of such accounts re- 
maining in the hands of the people of that city, for the all- 
sufficient reason that no mortal man has any idea, nor is 
there any data that can inform him concerning the per- 
centage of the savings-bank accounts of deceased persons 
that do not pass through the Surrogate Courts. 

As for example, savings-bank depositors, being poor or 
comparatively so, are very liable to have their savings 

247 



THE LABORER AND THE CAPITALIST. 

heavily drawn upon, if not entirely consumed, during a 
sickness of any considerable length. At all events, when 
a savings-bank depositor dies, the chances are many that 
his or her savings are withdrawn and disposed of, or that 
such other provision has been made that what remains in 
bank is paid over to some duly authorized agent of the de- 
ceased without the trouble and expense of court proceed- 
ings. In short, the rational inference from all the facts is, 
that a very small percentage, even of the savings-bank ac- 
counts of deceased depositors, are ever known to Surrogate 
Courts. Here, then, we have a third powerful reason why 
Dr. Spahr found so few savings-bank accounts recorded in 
the Surrogate Courts of New York City, while her savings 
institutions were rejoicing over a marvelous number, aggre- 
gating an amount that might be truly called prodigious. 

What meaning can the Surrogate records of New York 
City, or, indeed, of any other city or locahty for that 
matter, have concerning savings-bank accounts in the 
country at large ? In Massachusetts, in 1887 (see page 
173, this work), 150,274 persons opened savings-bank 
accounts, while 107,415 persons closed their accounts. And 
if we refer to the savings banks of the whole country, we 
find that the proportion of new accounts to the whole 
amounts to 15.9 per cent, per annum, while the accounts 
closed amount to 11.4 per cent, per annum of the total 
number of accounts; the difference in the number of 
accounts opened and the number closed was therefore 4^ 
per cent. 

The number of savings-bank accounts in the whole coun- 

248 



THE LABORER AND THE CAPITALIST. 

try in 1896 was^ in round numbers, about 5,000,000. If we 
take the percentage of accounts closed with the savings banks 
of Massachusetts as a basis, we find that the accounts closed 
in 1896 amounted to about 570,000. The death rate for 
the cities of the country, where most of the depositors re- 
side, averages a little less than two per cent. ; therefore, if 
the death rate was normal, about 100,000 of our savings- 
bank depositors died during the year (1896). If aU of 
these 100,000 accounts had passed through the Surrogate 
Courts, there would still be left approximately 470,000 ac- 
counts that disappeared in a single year, but which did not, 
nor could not, and in fact never can, pass through the Sur- 
rogate Courts, for the all-sufficient reason that they have 
been closed and the money withdrawn by the owners and 
invested in business or otherwise disposed of without any 
reference to Surrogate Courts. This fact demonstrates, 
even to a mathematical certainty, that at least eighty-three 
out of every 100 savings-bank accounts do not pass 
through the Surrogate Courts, and from this we know 
that the Surrogate records, as presented by Dr. Spahr, do 
not indicate even approximately the number or the total 
amount of savings in the hands of the people, rich or poor. 



CHAPTER VII. 

THE SURROGATE ARGUMENT AS APPLIED TO PROPERTY 
OTHER THAIS' SAVINGS-BANK ACCOUNTS. 

We have seen how the Surrogate records fail to illus- 
trate the facts regarding the distribution of savings-bank 

2i9 



THE LABORER AND THE CAPITALIST. 

accountSc Let us now inquire whether or not thej indicate 
the distribution of property other than savings-bank 
accounts. On page 57 of Dr. Spahr's work, he says : 

" If the death rate was normal during the period covered, the 
returns indicated about one hundred and ten thousand property- 
owning families. The whole number of families in the city 
(meaning New York) was three hundred and thirty thousand. 
In other words, two-thirds of the families are, in a strict sense of 
the word, propertyless." 

That the reader may be able to judge the more intelli- 
gently regarding the value of Dr. Spahr's basis for cal- 
culating the general distribution of wealth, I will quote 
(although I have quoted it before) a portion of his remarks, 
on page 56 of his work, as follows : 

" During the three months 2,500 men over twenty-five years of 
age died. . . . Their estates had to pass through the Surro- 
gate's Court before reaching the heirs. Yet, the whole number of 
estates entered was less than one thousand, and the whole number 
of estates left by males was barely six hundred. In other words, 
only one-fourth of the men who died left any property whatever 
except their clothing and household furniture." 

It wiU be observed that this calculation concerning the 
property-owning families in New York City is based upon 
the probated estates of males without any reference to fe- 
males. 

This appears to me very strange, not to say reckless, for 
on page 177 of Dr. Spahr's own work he has tabulated the 
inventoried estates in Massachusetts from 1859 to 1861, and 
those tables show that of the whole number of the estates 

250 



THE LABORER AND THE CAPITALIST. 

probated during those years, females owned more tlian one- 
third — to wit: males, 5,103; females, 1,819. 

I have shown that the corporations of Massachusetts 
have a great many female shareholders. And it will be 
remembered (see page 173 this work) that more than half 
(50 54^ per cent.) of the total amount of savings-bank de- 
posits in Massachusetts were owned by females. 

In a recent conversation with Mr. Joseph Brooks, 127 
Broadway, New York, who is the Vice-Manager of the 
celebrated Sherman Park property in the suburbs of that 
city, he told me that at auction and other sales of real 
estate in New York nearly one-half of the buyers are fe- 
males. But what is still more conclusive, and to the point, are 
the figures which appear in another part of Dr. Spahr's own 
book. In a foot-note on page 56, regarding the Surrogate 
records of New York City, he writes as follows : 

" For the entire year, 1893, more exact statistics can be given. 
The number of estates (testate and intestate) admitted to pro- 
bate, was 4,892. Of these 62 1-2 per cent., or 3,047, belonged 
to men." 

Take notice: 62 j4 per cent, of the estates that passed 
through the Surrogate Court of New York City in 1893 
belonged to men. Of course then the other 37^ per cent, 
belonged to women. Or, to state the same proposition in 
another way, the year that witnessed the death of 3,047 
property-owning males, witnessed the death of 1,845 
property-owning females. And the question arises, if these 
deceased male property owners indicate about 110,000 
property-owning families, as claimed by Dr. Spahr, how 

251 



THE LABORER AND THE CAPITALIST. 

many property-owning families do the deceased females 
indicate ? In other words, why is not a female property 
owner as likely to indicate a property-owning family as a 
male ? Or, does the sex make a difference ? Now, if we 
take the property-owning females into account (and, pray, 
why should we not ?), the Surrogate's records indicate not 
110,000 property-owning families in New York City, but 
176,000, which is 11,000 more than one-half, instead of 
about one-third, as estimated by Dr. Spahr. 

Let us reason a moment at this point. Suppose, for the 
sake of the argument, that the estates, great and small, of 
all deceased persons passed through the Surrogate Court. 
It would then follow that the size and number of the estates 
there recorded would indicate the size and number of the 
estates remaining in the hands of tlie living. As, for ex- 
ample — if when one thousand of the inhabitants of a county 
have died, it is found that five hundred estates have passed 
through the Surrogate Court, we have a right to infer that 
half of the people who are still living in that county have 
registered property also, for the very good reason that one- 
half of those who have died are shown by the Surrogate 
records to have had registered property. But then : if we 
offer such records as indicating the proportion of the popu- 
lation owning registered property, it must be understood 
that such records have been correctly kept. Or, if we offer 
a copy in evidence, it must be an exact duplicate of the 
original. For, if the copy contains more names than the 
original, it then follows that persons owning registered prop- 
erty are thereby made to appear too many. On the other 

252 



THE LABORER AND THE CAPITALIST. 

hand, if the copy contains less names than the original 
record, persons owning registered property are made to ap- 
pear too few, and the latter is precisely what results from 
Dr. Spahr's presentation of the Surrogate records. The 
copy he offers in evidence, and upon which he estimates 
the number of property-owning families in New York City, 
contains 37^ per cent, fewer names than the original 
records contain. By not taking the female property owners 
into account, out of every five deceased property owners he 
omits two. Out of every 100 he omits thirty-seven. 
Therefore, Dr. Spahr's handling of the Surrogate records 
for America's great metropolis exaggerates the number of 
poor, and makes the property-holding class appear very 
much smaller than it really is. In short, the data omitted 
by Dr. Spahr render his calculation absolutely valueless so 
far as it relates to the distribution of wealth in the city of 
New York. 



CHAPTER VIII. 

THE COUNTRY AT LARGE. 

To ascertain the general distribution of wealth. Dr. 
Spahr rehes upon certain localities, which he regards as 
typical of the whole country. 

Regarding his canvass of thirty-six counties in the State 
of New York in 1892, he writes (see pages 62-3 of his 
work) as follows: 

" The Surrogate records in many of these are most incomplete. 
Where every one knows to whom real estate belongs, it is not so 

253 



THE LABORER AND THE CAPITALIST. 

essential that estates containing only realty shall pass through the 
Probate Court in order that the title of the heirs may be unques- 
tioned. Furthermore, in some of these counties it was found that 
no statement had been required of the value of the realty in the 
estates which were brought into the courts. Fortunately, how- 
ever, in a few farming counties, the records were in good condi- 
tion, and the best brought out clearly what the* others indicated. 
The returns were as follows for five typical counties, containing 
no city and no village of over 4,000 people : 

" EECORD FOR MADISON, HERKIMER, WYOMING, CHENANGO, AND 
SCHOHARIE COUNTIES, OCTOBER TO DECEMBER, 1892. 

Number. Eealty. Personality. Total. 

150,000 and over 3 I 56,000 ^195,000 $251,000 

$50,000 to 15,000 60 334,475 288,688 623,163 

Under $5,000 149 243,525 221,733 465,258 



202 $634,000 $705,421 $1,339,421 
" As the number of families was but 38,000, the record showed 
that nearly three-fourths of them owned registered property." 

This calculation makes it appear that, in the five counties 
named, there are only three estates to every four families. 
But, fortunately, we have data that clearly demonstrate 
the fallacy of that proposition. Let us examine. 

The death rate in the community where the estates were 
probated must be relied upon to test the accuracy of Dr. 
Spahr's calculation. The annual death rate in the cities of 
New York and Brooklyn was, according to the eleventh 
census, 27.55 to every one thousand of the population, or 
2 3-4 per cent. In New York State, outside of the cities 
of New York and Brooklyn, the annual death rate was 16.08 

254 



THE LABORER AND THE CAPITALIST. 

to every one thousand of the population, or 1 6-10 per cent., 
and in the nation at large the annual death rate was 14.10 
to every one thousand of the population, or 1 4-10 per 
cent. The counties selected by Dr. Spahr, viz., Madison, 
Herkimer, Wyoming, Chenango, and Schoharie, are, as he 
says, purely agricultural, containing no city or village of 
over 4,000 inhabitants. These counties are also healthful 
above the average, therefore the death rate is low; 
undoubtedly lower than in the State at large, where 
all the cities are included. However, we will place the 
death rate in the aforesaid counties at 16.08 to each 
thousand of the population, or 1 6-10 per cent., which cor- 
responds to the average death rate in New York State out- 
side of the cities of New York and Brooklyn. The 
population of the aforesaid five counties, according to the 
State enumeration made in 1892 (see World Almanac, 
1896, p. 373), was 1873332, which, divided by five, gives us 
37,466 families, which is 534 less than Dr, Spahr's estimate 
of 38,000. However, we will let his estimate stand for the 
families of the ^Ye counties. 

If the death rate was normal (1 6-10 per cent.), the year 
1892 witnessed the death of 3,012 persons in the fiye coun- 
ties. If 202 estates were probated in three months, or 808 
during the year, as Dr. Spahr's table indicates, the number of 
probated estates was to the number of deaths as 1 to 3 
72-100, or, allowing five persons to a family, the number 
of estates to the number of families would be as 5 to 3 
72-100, or 51,075 registered estates to 38,000 families. 
Therefore, instead of it being true that the probate records 

255 



THE LABORER AND THE CAPITALIST 

indicated that tlie number of registered estates in the afore- 
said counties were one-fourth less than the number of fami- 
lies, they indicated that the number of estates was one-third 
greater than the number of f amihes. Or, to state the same 
proposition in still another way. Dr. Spahr's deduction from 
the Surrogate records is that the five counties named have 
only 29,500 registered estates, while I deduce from the 
same records that these counties have 51,075 registered 
estates. Difference in calculations, 21,575, or about 73 
per cent. The difference in our calculations results from 
the difference in estimating the death rate. Dr. Spahr 
must have figured, undoubtedly through oversight, the death 
rate for those counties at about 27 40-100 to every 1,000 
of the population, which is approximately the rate in New 
York City and Brooklyn. But it is 73 per cent, too high 
for the rural districts of New York State. This, you see, 
must throw him 73 per cent, out of the way in his estimate 
of the number of property holders indicated by the estates 
probated. In other words, by reckoning the death rate 73 
per cent, too high, he has estimated the registered estates 
73 per cent, too low. 

But, suppose Dr. Spahr had estimated the death rate cor- 
rectly, what would have been the result of his figures? 
What has been the result of my figures ? Have I learned 
sufficient about the number of estates to be able to form a 
satisfactory opinion regarding the comparative amount of 
property in the hands of the different classes of people in 
the counties named ? Not at all ; I have learned that Dr. 
Spahr's estimate of the number of property holders is too 

256 



THE LABORER AND THE CAPITALIST. 

low. But the element in the problem — the one set of figures 
that would lead to positive knowledge or enable me to ap- 
proximate the comparative holdings of the different classes 
of people in the aforesaid counties — is entirely absent from 
the Surrogate records. I refer to the estates of deceased per- 
sons that do not pass through the Surrogate Courts. Unless 
I have a tolerably perfect knowledge of the number and total 
amount of these. I have no index to either the whole num- 
ber of estates or the proportionate value of property held 
by the two classes commonly denominated rich and poor. 

A word from Dr. Spahr shall introduce the remainder 
of my arguments upon the Surrogate record theory. 

On pages 64-5 of his work, he has written as follows : 

"The small holdings of real estate should be increased about one- 
half, because of the failure to record real estate in rural counties. 
It is chiefly the small holdings of realty that fail to be recorded." 

The fact that small holdings are not as generally pro- 
bated as the larger has a meaning of very great importance, 
which I shall consider more at length further on. 

On page 69 of his work Dr. Spahr writes as follows : 

" Less than half the families in America are propertyless. 
Nevertheless seven-eighths of the families hold but one-eighth of 
the national wealth, while one per cent, of the families hold more 
than the remaining ninety-nine." 

Following the above statement is a foot-note, in which 
the doctor says : 

" Since the completion of this study, a volume has appeared 
which must set at rest all question as to the extreme moderation 
of the estimates reached." 

257 



THE LABORER AND THE CAPITALIST. 

The volume referred to by Dr. Spahr, and which he 
thinks must set at rest all question as to the extreme mod- 
eration of his estimates, is the report of the Massachusetts 
Labor Bureau. He. quotes from Part II of the Report of 
that Bureau for 1894, showing the number of estates pro- 
bated in the three years 1889, 1890, and 1891, to have 
been 14,608, and the value thereof $155,558,788. 

My claim is not that the Surrogate records are false in 
themselves, or that they do not serve the purpose for which 
they are kept, viz., to estabhsh the validity of claims, as 
for example: When an owner of an estate dies, with or 
without a will, if the estate be of the larger class, the heirs 
naturally desire such a public record of the way the prop- 
erty is divided, that their legal claim to a specified portion 
or piece thereof cannot be questioned in the future. With 
the smaller estates, a public record is not so important ; in 
fact, it is as Dr. Spahr has stated, in substance (see 
quotation, page 258). Owing to the lesser amount involved, 
the heirs are more likely to settle matters among themselves, 
and the Surrogate Courts are less frequently employed. 
Then, too, consider how many estates are disposed of by 
deed, etc., when death is supposed to be nearing. Within 
the last few days a New York physician remarked of a pa- 
tient that he had transferred his property in anticipation 
of his demise. Of the great number of estates disposed of 
in this way, the Surrogate Courts have no record. This 
fact, coupled with the further fact that the smaller estates 
fail to be probated much of tener than the larger, is suffi- 
cient to show the worthlessness of the Surrogate records in 

258 



THE LABORER AND THE CAPITALIST. 

a discussion like this. Yet the following argument will be 
useful as a mathematical demonstration, to wit : We know 
from unquestioned and unquestionable statistics that the 
average length of life in the United States is about 33 1-3 
years, which means that death compels all the wealth of 
the country to pass from owners to heirs approximately 
once in the course of every 33 1-3 years. This is at the 
rate of 3 per cent, per annum for all property. Now, 
the value of the State of Massachusetts in the years 
named by Dr. Spahr was, according to the census of 1890, 
$2,803,645,447 (see abstract 11th census, page 192). Ac- 
cording to Dr. Spahr, there passed through her Surrogate 
Courts during these three years the sum of $155,558,788; 
or, $51,852,929 per annum. But mark you, death dis- 
tributed to heirs in Massachusetts during these same three 
years the sum of $252,328,090, or $84,109,363 per 
annum. Therefore, we see that about 38 per cent, of the 
value of the estates in question was not probated. In other 
words, for every ten thousand dollars of the property of 
deceased persons that passed to the heirs through the Sur- 
rogate Courts of Massachusetts during the three years 
named there were about six thousand two hundred and 
twenty dollars that reached the heirs without passing 
through the Surrogate Court ; thus demonstrating even to 
a mathematical certainty, that only a little more than three- 
fifths (62 per cent.) of the property of deceased persons 
passes through the Surrogate Courts, even in the sturdy and 
thoroughgoing old commonwealth of Massachusetts. 

Now, when we thoughtfully consider this fact, together 

259 



THE LABORER AND THE CAPITALIST. 

with the further fact that the property that fails to be re- 
corded in the Surrogate Courts is very generally the hold- 
ings of the poorer classes, we are not left to guess, or con- 
jecture ; we know that the Surrogate Courts which have no 
account of either the number of estates, or the proportion 
of the people's property that is never probated, cannot be 
relied upon to indicate the comparative amount of wealth 
now in the hands of the different classes of American citi- 
zens. 

However, as a chncher for his Surrogate argument. Dr. 
Spahr has quoted a table from the report of the Massachu- 
setts Labor Bureau. It is the report previously referred to 
which he regards as certain to set all question to rest as 
regards the moderation of his estimates. It appears on 
page 69 of his work as follows : 

«f INVENTORIED ESTATES IN MASSACHUSETTS, 1889-1891. 

Number. Value. 

Under $5,000, . . . 10,152 116,889,479 

15,000 to 50,000,. . . 3,947 53,489,893 

50,000 and over, ... 509 85,179,516 



14,608 1155,558,788" 

The most important part of Dr. Spahr' s remarks concern- 
ing this table are as follows : 

" The estates of 850,000 and over aggregated 55 per cent, of 
the total amount of property; while estates less than f5,000 ag- 
gregated but 11 per cent, of the total. Additional value is given 
to this Massachusetts report by the fact that a similar investiga- 
tion was made of the probate records for the years 1879-1891, 
1859-1861, and 1829-1831, and the results published." 

260 



THE LABORER AND THE CAPITALIST. 

Take notice the records quoted by Dr. Spahr are, accord- 
ing to his understanding, rendered more important by the 
fact that similar investigations have taken place before, 
and the facts published. Candidly, reader, of vfhat value 
are such reports, since the records investigated have no data 
concerning at least 38 per cent, of the property of deceased 
persons. Nevertheless, Dr. Spahr has made his calculation 
for the distribution of wealth throughout the entire country 
from precisely this kind of data. On page 66 of his work 
he writes as follows : 

" The proportion holding over $50,000 is exceptionally great in 
large cities, and exceptionally small in tlie country districts, but 
the proportion in the intermediate territory selected may be safely 
assumed for the entire nation. The table for the nation at large 
would therefore read : 

Number of Aggregate 

Families. Wealth. 

150,000 and over, . 125,000 133,000,000,000 

150,000 to $5,000, . . 1,375,000 23,000,000,000 

Under 15,000, . . 11,000,000 9,000,000,000 



12,500,000 165,000,000,000" 

Of course, this table does not take into account, as his 
former tables have failed to recognize, the 38 per cent, of 
the property of deceased persons that does not appear upon 
the Surrogate records. Then, too, it makes a wonderful 
difference with the appearance of results where the separat- 
ing points are placed. 

Let us now have a table with the 38 per cent, added, less 
f 1,221,011, which we will allow to the larger estates, some 

361. 



THE LABORER AND THE CAPITALIST. 

of which may also fail to be probated. This addition will 
change the ratio of property between the larger and smaller 
holders amazingly. Also let us place the separating points 
nearer together, and then study the results in comparison 
with Dr. Spahr's final calculation. I offer the following 
table as approximating the present distribution of wealth 
in the United States : 



Under $10,000 


132,500,000,000 


50 per cent 


110,000 to 150,000 


10,400,000,000 


16 " " 


50,000 to 100,000 


4,875,000,000 


7 1-2 " " 


100,000 to 200,000 


4,875,000,000 


7 1-2 " " 


200,000 to 500,000 


6,175,000,000 


9 1-2 " " 


500,000 to 1,000,000 


2,275,000,000 


3 1-2 " " 


1,000,000 and above. 


8,900,000,000 


6 " " 




165,000,000,000 


100 per cent 



These figures absolutely reverse Dr. Spahr's table, but it 
is simply and entirely the result of recognizing data which 
he has unfortunately overlooked, and of placing the separat- 
ing points where he has not. In other words making the 
divisions and allotting to each class what surely belongs to 
it, so that the reader gets a true and not a false or exag- 
gerated idea of the distribution of wealth among the prop- 
erty holding people. Instead of the masses owning so 
much less, as one would infer from Dr. Spahr's table, they 
own eight times more than the very richest class, fourteen 
times more than the second richest class, four times more 
than the third richest class, nearly seven times more than 
the fourth richest class, and we will let the story end with 

262 



THE LABORER AND THE CAPITALIST. 

the repetition of the glorious truth that that class of our 
people whose individual estates amount to ten thousand 
dollars and less, own a share of the national wealth, aggre- 
gating, to say the least, as much as the wealth of all other 
classes combined. 

Those who are suf&ciently awake to the situation to reahze 
the possible consequences of the increasing unrest arising 
from the belief that the masses are poorer because a few 
are rich, will be glad to know that our calculation regard- 
ing the distribution of wealth does not differ very ma- 
terially from a calculation by the Chief Engineer of the 
Geological Survey for the eleventh census. I refer to 
Henry Gannett. In his work, " The Building of a Nation," 
he computes the wealth of the United States in 1890 at 
$62,600,000,000 which he says is in the hands of the dif- 
ferent classes of our people, as follows : 
Millionaires ....... 5 per cent. 

1100,000 to 11,000,000 .... 27 " " 

10,000 to 100,000 25 " « 

1,000 to 10 000 .... 37 " " 
1,000 and less 6 " ♦' 

It will be observed that Mr. Gannett's calculation shows 
those owning less than one thousand dollars to possess more 
wealth in the aggregate than the very rich (the millionaires), 
while only 32 per cent, is found in estates above one hun- 
dred thousand dollars. In fact, if Mr. Gannett had made 
seven divisions of his table, as we have done, it would have 
read nearly the same as ours, which was made without any 
reference to his. 

263 



THE LABORER AND THE CAPITALIST. 

Now as to Mr. Gannett's calculation and that of Dr. 
Spahr's — one is based upon the Census reports rendered by 
officers of the Government^ sworn to canvass every citizen 
of the United States and learn the value of all property ; 
the other is based upon Surrogate records, which as a rule 
have no account of a very important percentage of the 
smaller holdings. 

CHAPTER IX. 

RAILKOADS AND FARMS. 

On page 40 of Dr. Spahr's work I find the following : 
" The financial legislation and the tax legislation of the Na- 
tional Government have, however, been but two of the three great 
causes which have operated for the concentration of wealth during 
the present generation. Prior to the Eebellion, the railroads 
counted next to nothing in the national stock-taking. The greater 
part of the property of the country was still upon the farms. . 
. . To-day the railroads alone count for haH as much 
property as the farms ; and their securities are held exclusively in 
the cities." 

Wealth is concentrating in railroads at the expense of 
the rural districts, is Dr. Spahr's understanding of the 
case. Numerous other writers are advancing the same 
ideas, and the masses are as a rule indorsing them. Rail- 
road property is increasing rapidly, while the farming in- 
dustry languishes, is the verdict of common observation. 

For the sake of convenience, we will state figures in 
round numbers in the following propositions. 

In 1860 the value of the railroads of the United States 

264 



THE LABORER AND THE CAPITALIST. 

was about two billion. If the ratio of their indebtedness 
was then what it has been for the last twenty years (about 
one-half) the raiboad property of 1860 was about one 
billion clear of debt. 

In 1890 the railroads were valued at about eight billion 
(abstract of eleventh census, page 193) ; but their indebt- 
edness amounted to about five billion, leaving the railroads 
of 1890 worth about three billion clear of debt; an in- 
crease from 1860 to 1890 of about 200 per cent. 

The farm property of the country in 1860 amounted to 
about seven bilhon clear of debt. In 1890 farm property 
amounted to about fourteen billion clear of debt. In other 
words, while the railroads gained two billion clear, the 
farms gained seven billion. But the fact must not be 
overlooked that a tremendous war had taken place, which 
had resulted in great financial loss, for the time at least, to 
a large section of the country, which is almost exclusively 
agricultural. 

The year 1870 found the South with $3,300,000,000 
less property than it had in 1860. 

From 1850 to 1860, the South had gained in wealth at 
exactly the same rate as the rest of the country ; therefore, 
had it not been for the war, her gain from 1860 to 1870 
would have been $6,200,000,000. Instead of that, how- 
ever, she gained nothing, but lost $3,300,000,000, making 
a difference against the South of nine and one-halB 
billion. 

If we allow one and a half billion of this to Southern 
cities, eight billion are left to be added to the property of 

265 



THE LABORER AND THE CAPITALIST. 

the rural districts, which would make a clear of debt 
increase of $14,800,000,000, or 213 per cent. In other 
words, all other things being equal and nothing extraordi- 
nary happening to either, the net increase in farms and farm 
property during the thirty years in question, has been about 
13 per cent, greater than in that of railroad property. 

No pretension is made to accuracy in this calculation, yet 
it approximates the truth very closely. There has been 
stock watering among the railroads, sometimes justly, some- 
times unjustly, and money has found its way into the wrong 
pockets, and no doubt some men have become wealthy in 
that way. Yet, as a rule, railroads have not been exception- 
ally profitable to their owners, to say the least, while 
in very many cases they have been exceedingly dis- 
astrous. And when it is claimed that railroads, as a rule, 
are getting an undue proportion of the general income, the 
claim is not only unsupported by any reliable data, but it 
is absolutely contradicted by the experience of more than 
haK a century. To those who insist that the railroads are 
absorbing the wealth of the country, I will submit the fol- 
lowing from the most distinguished statistician of modern 
times. I refer to Mulhall. On page 500 of his Dictionary, 
he writes as follows : 

" It may be roughly estimated that railroads, as a rule, have 
caused a saving to the public of each country equal to at least 10 
per cent, per annum on the cost of construction." 

Take notice : The total cost of construction of railroads 
in the United States up to 1896, has amounted to about 
$9,861,000,000. And the 10 per cent, annual saving to 

266 



THE LABORER AND THE CAPITALIST. 

the people amounts to $986,000,000 per annum ; which in 
the course of every ten years equals the total value of all 
the raiboads. 

Again, when we consider all the business transacted by 
the raiboads and the profits accruing to them thereon, as 
we deduce them from "Poor's Manual of Railroads," we 
find that the stockholders of those roads receive profits of 
one cent for carrying a passenger seven miles, while a ton 
of freight is moved seventeen and a half miles for a profit 
of one cent, the balance of the prodigious sum of money 
paid by the people to the raiboads for freight and fares 
going to pay fixed charges, and to defray expenses of one 
kind and another. And finally it ought to be stated that 
the highest dividends ever declared by the American rail- 
roads was in the year 1892, when they amounted to $95,- 
662,412. In other words, in the most prosperous year our 
railroad owners have ever known, their efforts and invest- 
ments resulted in a gain of $10 to the public for every $1 
that went into theb own pockets. If this is concentrating 
the wealth of the country, farms or what not, in the hands 
of raiboad owners, I confess I have not the abibty to see it. 



CHAPTER X. 

RENTED FARMS. 

Dr. Spahr has emphasized the familiar rented-farm ar- 
gument by quoting competent authority (government sta- 
tistics) showing the growing increase in the number of 
rented farms, and of farm tenants. Rented farms furnish 

267 



THE LABORER AND THE CAPITALIST. 

a plausible and convincing argument for those who insist 
that the condition of the masses is growing less and less 
hopeful as compared with that of the capitalists. 

There are more tenant farmers than formerly, but it is 
important to consider that the greater the number who 
come to desire farms, and the more successful in saving 
money farm hands become, the larger the number who will 
sooner or later become tenant farmers, not permanently of 
course, but then, a rented farm is a stepping-stone to the 
ownership of a farm. 

Again, consider that about fourteen per cent, of our 
immigrants are farmers from the old world, who, as a rule, 
are obliged to be tenants before they can become owners ; 
and right here, mark you, is where we get a very large per- 
centage of our modern tenant farmers. Immigration 
amounted to nearly as much in the ten years from 1880 to 
1890 as it had the preceding twenty years. In fact, if 
no other arguments were offered, the influx of foreign 
farmers, who are unable to buy in the first instance, would 
nearly, if not entirely, account for the increase of tenant 
farmers in the United States. Note what a great number 
of Vermont and New Hampshire farms are being let every 
year to people from across the Canada line, for example ; 
and who is not famihar with the fact (if he has taken the 
trouble to observe and think) that a very great majority of 
the tenant farmers of the West are comparatively fresh 
from the farms of other countries. 

However, the popular tenant-farm argument is totally 
annihilated by the fact that the increase in the number of 

268 



THE LABORER AND THE CAPITALIST. 

farm owners more than keeps pace with the increase in the 
farming population (Census, 1890), which proves to a mathe- 
matical certainty that if more farms are rented, it is not be- 
cause former farmers are becoming tenants, but because 
more people are demanding farms or engaging in the farm- 
ing business, who have not yet gathered sufficient means to 
purchase for themselves, but have enough to enable them 
to become part owners, at least, in the stock of a farm, its 
machinery, etc. Therefore, generally speaking, a rented 
farm in this country indicates not that the occupant has 
been reduced from proprietor to tenant, but that he is mak- 
ing headway toward the ownership of a farm. 

I was once powerfully affected by the rented-farm argu- 
ment. I hved in the West and saw many farms pass into 
the hands of money-loaners, and it seemed to me perfectly 
clear that capitalists were absorbing the wealth of the 
masses ; that of farmers especially. But when I resorted 
to a statistical investigation, as before explained, I soon dis- 
covered that a larger percentage of money-loaners, bankers, 
etc., were failing than of farmers. This was a great reve- 
lation to me, and an incentive to continue my investiga- 
tion, through which I discovered that the percentage of 
failures was also much greater among manufacturers and 
merchants than among farmers. And from this I know, 
that whatever of disaster or failure has come upon the 
business of the country, the farmers are stemming the tide 
as successfully, to say the least, as any other class of our 
people, manufacturers, merchants, and money-loaners not 
excepted. 

269 



THE LABORER AND THE CAPITALIST. 
CHAPTER XI. 

THE FALL OF WAGES. 

I must here repeat what I have so often said in this work, 
to wit : The one great cause of the existing differences 
between the laborer and the capitaHst is the lack of knowl- 
edge regarding the economic relations of one to the other, 
and the omission of data by honest but misled writers that 
would certainly lead to opinions very different from those 
which now dominate the public mind. It wiU not be amiss 
to also repeat that this lack of knowledge appears to 
be about as general in one class of the community as in 
another; among competent writers as among those who 
could not write if they tried. Take notice: Dr. Spahr 
remarks that wages have fallen within a certain period, and 
he also comments on the fact that labor is not well employed 
at the present time. He introduces these arguments to 
prove that labor is getting a smaller and smaller share of 
the general income. I think he estimates the falling off in 
the income of labor from these causes in recent years to be 
about twenty per cent. He omits to state, however, that 
the profits of capital and the rates of interest have fallen in 
quite as large a ratio. How could it be otherwise when 
the income of capital and labor are, as a whole, and in the 
long run, absolutely dependent upon each other. Where 
does labor get employment, as a whole, if capital does not 
furnish it ? How can capital flourish as a whole except 
labor buys its goods ? 

270 



THE LABORER AND THE CAPITALIST. 

We are now passing through a business crisis and labor 
is not as well employed, neither does it receive as large an 
income as usual. But what of it ? When capital is all em- 
ployed, labor is all employed, and it must therefore follow 
that whatever percentage of labor is unemployed has resulted 
from a like percentage of capital being unemployed, which 
can have no other effect than to lessen the income of capital. 
Therefore, instead of the falling off in the earnings of labor 
proving that capital is getting a larger share of the general 
income, it only proves that capital is suffering equally with 
labor. This proposition is absolutely unquestionable from 
the fact, before explained, that the laborer is never idle 
when the capitalist can see any profit in employing him. 



CHAPTER XII. 

THE POOR m CITIES. 

On page 50 of Dr. Spahr's work, I find the following : 
" That the cities to-day, like the Southern States a generation 
ago, are the centers of extreme poverty as well as of extreme 
wealth, is a matter of common observation." 

That our cities contain great wealth and much poverty 
is very certain. The radical school of economists attribute 
the cause to a wrong economic system, through which the few 
rob the many. I attribute the cause, as before explained, 
mainly to the influx of immigrants from the poorer districts 
of the old world. Some writers have made an attempt to show 
that foreigners are as generally property-owners as native 
Americans. This proposition, however, is too palpably 

271 



THE LABORER AND THE CAPITALIST. 

inconsistent to need arguing. It is unquestionably true, 
that no insignificant proportion of our citizens of foreign 
parentage are property-holders and compare favorably with 
native Americans in intelligence and in all the essential 
qualities of good citizenship ; but to claim that, as a rule, 
the foreigners are as generally property-holders as the 
natives, is to assume that they are naturally very much the 
superior of Americans in industry, in economy, and in 
calculation. For certain it is, that, for the most part of 
their lives, a large majority of our foreign population have 
had no such opportunity to acquire wealth as the native 
Americans have had. And the same is true of a large 
majority of our colored citizens ; they are comparatively 
new from a kind of life which was by no means calculated 
to develop property-gaining talent. In the census of 1890 
the occupations of immigrants are classified as follows : 

"Professional occupations . . 1 per cent. 

Traders and dealers . . .3 per cent. 

Farmers . . . . . 14 per cent. 

Household servants ... 9 per cent. 

Skilled labor . . . . 20 per cent. 

Unskilled labor . . . .53 per cent." 

It will be observed that if we throw the farmers entirely 
out of the wage-earning class, there remains 82 out of 
every 100 immigrants practically without property. Ac- 
cording to same census, out of every 57 of the paupers of 
the country, 9 were colored, 9 were born of foreign 
parents, 30 were born in foreign countries, and but 9 were 
native white Americans. 

272 



THE LABORER AND THE CAPITALIST. 

From this we see that 84 out of every hundred paupers 
in the United States are either colored, foreign born, or 
born of foreign parents. 

Again, the eleventh census says that in New York and 
Chicago practically four-fifths of the population in 1890 
were of foreign parentage ; 80.46 per cent, for New York ; 
77.90 per cent, for Chicago. In Milwaukee the proportion 
of foreign population was still greater, being 86.36 per 
cent. In Philadelphia it was 71.40 per cent. ; Brooklyn, 
67.46 per cent. ; Boston, 67.95 per cent. Seventeen of our 
principal cities have an average of over 75 per cent. It 
would be a low estimate to say that more than three-fourths 
of the population of twenty-five of our largest cities is made 
up of colored people and those born of foreign parents. 

But the greatest cause of poverty in cities as I have be- 
fore shown is due to intemperance. There are 218,874 sa- 
loons in the United States, or one saloon to every 310 of 
the population. These saloons are principally in the cities. 
New York has one saloon to every 236 of the population. 
Some of the poorer parts of the city have a saloon for every 
175 of the population, or one for every thirty-five families, 
and it appears almost superfluous to repeat what I have 
said before and what is so generally understood, to wit, that 
not a few of the patrons of these saloons are spending more 
money for liquor than they spend for f ood,rent, and clothing. 

The treatment given this subject in the earlier part of 
this work renders it unnecessary to go into detail here, 
yet it would be little less than criminal to omit a statement 
made by the Massachusetts Labor Bureau, 1893. This bu- 

273 



THE LABORER AND THE CAPITALIST. 

reau made a special investigation of the localities in Boston 
where the poorer tenement-houses are located, one of the 
objects being to learn, as far as possible, " why the tenants 
of the poorer houses remain in undesirable conditions." 
Waldron's Hand Book, page 31, refers to the table com- 
piled by the aforesaid bureau as follows : 

"The . . . table shows, as a result of the inquiry, that 
more than 42 per cent, of these people live in bad tenements 
primarily because of intemperance." 

The tremendous facts above quoted tell their own story. 
And may I not ask in the name of common sense, and com- 
mon honesty, if, when we consider that more than 85 per 
cent, of the foreign and colored element (outside of the 
Southern States) is confined to our cities, and to this add 
the further fact that 42 per cent, of those Kving in the 
poorer tenement houses confess their poverty to be due to 
intemperance ; when we combine all these facts, I say, have 
we not abundant reason for the great number of poor 
people in our cities, without attaching even the shghtest 
blame to our economic system ? 



CHAPTER Xm. 

TAXES. 

There is another production on the concentration of 
wealth which I feel disposed to notice in this essay. Like 
Dr. Spahr's work, it has been quoted approvingly in the 
National Legislature and by not a few of our speakers and 
literary publications. I refer to an article by Thomas G. 

274 



THE LABORER AND THE CAPITALIST. 

Shearman on pages 269-270 of the Forum for November, 
1889. 

The tremendous rate at which Mr. Shearman thinks he 
sees the wealth of the country concentrating in the hands 
of a few through the tax or draft made upon labor by- 
capital, may be imagined from a statement by him in the 
aforesaid magazine. He says : 

" Within thirty years, the present method of taxation being 
continued, the United States of America will be substantially 
owned by less than 50,000 persons, constituting less than one in 
five hundred of the adult male population." 

In another part of Mr. Shearman's article he writes as 
follows : 

" The wealth of the very rich is always more underestimated by 
assessors than that of men in moderate circumstances. Assess- 
ments of §400,000 and over are therefore multiplied in the next 
table by two and one-haK, while those below that line are only 
doubled." 

Mr. Shearman has started out to prove the concentration 
of wealth, and he begins to lay his foundation by assuming 
that the property of the rich is estimated exceptionally low 
by assessors. He therefore multiplies the assessor's esti- 
mates by two and one-half, etc., as he has explained in the 
above quotation, and upon this basis he figures out a con- 
centration of wealth that is truly starthng. The under- 
valuation of the rich man's property by assessors, is a very 
general complaint among men of Mr. Shearman's way of 
thinking, and very serious complaints are brought against 
property holders on that ground. They are accused of 

275 



THE LABORER AND THE CAPITALIST. 

bribing assessors and o£ employing other dishonorable 
means to shift the burden of taxation from their own 
shoulders to the shoulders of their neighbors. That there 
are wealthy individuals who would and who do accomplish 
just that thing, I do not doubt ; and that there are assess- 
ors guilty of knowingly underestimating property, I feel to 
be unquestionable. Indeed, some are now before the 
courts of New York charged with that offense. However, 
it would be very dif&cult for assessors to generally under- 
estimate the property of the wealthier class of people, and 
not be detected and punished, for the very good reason that 
everybody knows that when his neighbor's property is 
assessed too low, the burden falls that much heavier on 
him, and he watches the tax list and assessments with a 
jealous eye. 

Again, the general undervaluation of the larger proper- 
ties of the country could not result in a general saving to 
their owners, for the all-sufficient reason that as assess- 
ments are crowded down, tax rates are bound to rise, as for 
example : New York City is obliged to raise thirty-five mill- 
ions of dollars more or less, annually, to defray city ex- 
penses, and the tax rate is, say, two per cent. But the 
property holders induce assessors to estimate their holdings 
fifty per cent, lower than last year, or below what it ought 
to be — the tax rate must then be raised to four per cent., 
for the city must collect a certain amount of money from 
her citizens, and by as much as the rate of assessment is 
lowered, by precisely that much must the tax-rate be raised. 
As a whole, capital can no more gain by crowding assess- 

276 



THE LABORER AND THE CAPITALIST. 

ments down than a man can lift himself into the air by 
puUing at his bootstraps. 

But leaving this all out of the question. What right has 
Mr. Shearman to assume that the property of the very rich 
is more generally underestimated than that of the moder- 
ately rich or the comfortably well-to-do ? A tax assessor 
recently told me that he had found that people of compari- 
tively small means were just as anxious to conceal their 
property or to report it low (so as to be obliged to pay the 
smallest possible amount of tax) as the richer were. Why 
should they not be ? A hundred or a thousand is as pre- 
cious to the possessor of small means as greater amounts 
are to the possessors of larger means, But^ strange as it 
may appear at first glance, there is a very decided reason 
why the wealth of rich people is more generally over-esti- 
mated than that of those whose possessions are smaller. I 
will introduce my first argument upon this point with a 
quotation from a work, " The Distribution of Wealth/' by 
J. R. Com^mons, Professor of Economics and Social Science, 
Indiana University (1893). On page 257, Professor Com- 
mons quotes Mr. F. C. Waite, special agent of the Eleventh 
Census in charge of " True Wealth/' as follows : 

" The monopolistic value of land, i.e. : — the unearned increment, 
equaled in 1890 about $25,000,000,000. This enormous land 
value is largely made up of inflation, resulting from the fact that 
owners and buyers expect to continue pihng increase on increase 
year after year. In some sections almost every dollar of these in- 
flated values are liable to vanish when a gi'eat commercial crisis, 
like that now brewing, sweeps across our continent." 

277 



THE LABORER AND THE CAPITALIST. 

This statement of the special agent of the eleventh cen- 
sus regarding true wealth is full of meaning. No small 
proportion of the estimated wealth of the rich consists of 
just such inflated land values as Mr. Waite has described. 
Not only this, but mines, ranches, bonds, and mortgages 
based upon fictitious values are held by the reputed rich in 
immense amounts. I notice that the savings banks of the 
one State of New Hampshire, notwithstanding the great 
care they take, and are obliged by law to take, in the selec- 
tion of their securities, have lately lost over four millions 
through investing in bonds and mortgages, the value of 
which was supposed to be real, but which proved to be 
largely imaginary. 

Again, consider the lesson taught by the failure of re- 
puted wealthy men and business firms. In the last seven 
years the liabihties from failures have amounted to $1,288,- 
000,000. More than one-half of this is dead loss to failing 
capitalists ; and if we go back twenty-five years, the actual 
loss, or deficit, has amounted to a sum equal to the value 
of the State of Massachusetts, with her immense factories, 
her rich cities, her ships, her* railroads ; in fact, all the ac- 
cumulations of her industrious sons and daughters since the 
landing of the Pilgrims on Plymouth Rock. This vast sum 
has been credited to our rich and comparatively rich men, 
manufacturers and traders, but really these people were not 
vv'orth it. If they ever possessed it, it had been paid to 
labor for services performed in one way or another, as be- 
fore explained. As a matter of fact we generally overesti- 
mate the value of our wealthier neighbor's property, espe- 

278 



THE LABORER AND THE CAPITALIST. 

eially if they are doing a large business. And not a few 
of these people have allowed themselves to be assessed for 
more capital than they had for the sake of the credit it gave 
them in business circles. Of course, it cannot be conjec- 
tured how much such overvaluation amounts to as a whole. 
Nevertheless the history of failures has given us a hint 
worth noting, and it may be added that Bradstreet's Report 
for 1895 says that 27 per cent, of all who failed in 1893 
and 1894 had been reported in good standing ; that is, 27 
out of every 100 failing firms and individuals have been 
estimated, even by the careful agents of Bradstreefs, as 
worth very much more than they really were. This fact 
alone ought and will, if properly considered, do much to 
rid the public mind of a great fallacy. In short, I regard 
the foregoing facts and history as sufficient to warrant the 
conclusion that the property of the reputed rich is more 
generally overestimated than that of any other class of 
people. 

CHAPTER XIV. 

TAX LISTS COMPAKED. 

Mr. Shearman, after having estimated American wealth 
upon the basis of English statistics, writes as follows : 

" Objections wiU doubtless be made to any estimates based upon 
British statistics. Fortunately Massachusetts furnishes a purely 
American basis for estimates of the distribution of American 
wealth. A list of the largest individual tax-payers in Boston, 
published this year, including all (exclusive of corporations and 
executors) who paid more than ^1,000 in taxes, and who were 

279 



THE LABORER AND THE CAPITALIST. 

therefore assessed at more than 175,000 (the tax being 1 1-3 per 
cent.) showed the following results : 

BOSTON TAX LIST, 1888. 



Individual Tax Payers. 
Number. 


Amount of Tax. 


Average Assessed Wealth. 


2 


$50,000 to 75,000 


14,600,000 


i 


40,000 to 50,000 


3,205,450 


3 


30,000 to 40,000 


2,732,570 


8 


20,000 to 30,000 


1,840,000 


39 


10,000 to 20,000 


930,000 


133 


5,000 to 10,000 


600,000 


1,065 


1,000 to 5,000 


160,000" 



Following this table, Mr. Shearman says : 

" It may be safely assumed that every one who is assessed at 
1400,000, is reaQy worth one million, etc." 

He proceeds with his reckoning and deductions upon 
that basis. Nevertheless, since he takes Boston tax lists 
for his basis, he will undoubtedly admit that Boston tax 
.lists are likely to be as reliable at one time as at another. 
It wiU be readily seen, therefore, that a comparison of the 
lists of the later period with that of an earlier will show 
whether or not wealth has really concentrated. 

I am glad to be able to state that I have carefully ex- 
amined the Boston tax list for 1821, and taken account of 
the indi\ddual holdings and the taxes paid by the citizens 
of Boston in that year, and with the following results, as 
compared with Mr. Shearman's tax lists for 1888. 



380 



THE LABORER AND THE CAPITALIST. 

Before the comparison is made, however, we need to 
note an explanation which appears on page 60 of the ap- 
pendix to the Boston census of 1845, as follows : 

"In 1842 the tax was first assessed upon the full valuation. 
For many years previous to that, the valuation was entered upon 
the assessor's records at half its real value, and the taxes assessed 
on that amount. To present the facts uniformly in this table the 
valuation has been doubled and the rate of taxation halved, in the 
years before 1842." 

Boston is now assessed at its full valuation, but it will 
be seen by this explanation that in 1821 Boston was assessed 
at one-half, instead of its full valuation. And from this we 
see that in order to get a just comparison between any date 
previous to 1842 and a later period, the prior assessment 
should be doubled, as explained in the assessors, note above 
quoted. 

In 1888, the two largest tax payers heading Mr. Shear- 
man's Hst, their wealth averaging $4,600,000 each, owned 
1.14 per cent, of the assessed valuation of the city of Boston, 
while in 1821 the two largest tax payers, their wealth averag- 
ing $513,400 each, owned 2.54 per cent, of the city of 
Boston. In other words, the two richest men of Boston in 
1821 owned 123 per cent, more of the city than was owned 
by the two richest men in 1888. 

Or if we select the nine richest individuals whom Mr. 
Shearman has placed at the head of his list, comprising all 
above $2,250,000, we find that they owned 3.75 per cent, 
of the assessed valuation of the city of Boston in 1888, 
while in 1821 the nine richest individuals, comprising aU 

281 



THE LABORER AND THE CAPITALIST. 

above $280.000, owned 8.52 per cent, of the value of Boston. 

Or if we take fifty-six of Mr. Shearman's richestjCompris- 
ing all over $750,000 each, we find that in 1888 these 
fifty-six individuals owned 10.08 per cent, of the city of 
Boston's assessed valuation, while in 1821 the fifty-six 
richest men owned 19.90 per cent, of the assessed valuation 
of the city. Or to state the same proposition in still 
another ■W2iy ^ fifteen of Boston's richest citizens owned a 
larger proportion of her wealth in 1821 than was owned by 
the fiftysix richest citizens whose wealth is tabulated in 
Mr. Shearman's list for 1888. This does not look as if the 
property of Boston was rushing into the hands of a few. 
On the contrary, it shov/s that the wealth of the city was 
very much more generally diffused in 1888 than it had 
been in 1821. 

Dr. Spahr has made reference to a Boston tax list of 
another date which I am glad to notice. On page 33 of 
his work, he says : 

"The Boston tax lists for 1845 show two hundred and seven- 
teen holdings of more than one hundred thousand dollars worth of 
property (real and personal)." 

Not doubting the correctness of Dr. Spahr's statement 
regarding the holdings of the richest 217 citizens of Boston 
in 1845, I quote for the purpose of making a comparison 
of the larger holdings of that date with those of 1888, the 
year selected by Mr. Shearman. 

I have not the Boston tax list for 1845 before me. In 
fact, I do not need it, since I rely upon Dr. Spahr's data, 
but I have that of 1851. Taking the proportions of wealth 

282 



THE LABORER AND THE CAPITALIST. 

then existing as a basis, Dr. Spahr's list of 217 individuals 
worth over $100,000 each would indicate 333 individuals 
worth over $75,000 in 1845, averaging $163,976 to each 
individual and aggregating $54,604,712, the same being 
39.77 per cent, of Boston's wealth. The hst of 1888, ac- 
cording to Mr. Shearman, shows 1,254 individuals worth 
$75,000 and over, averaging $253,756, aggregating $318,- 
109,510, or 39.48 per cent, of the city's wealth. That is, 
the same proportion (.00291) of population owned a larger 
proportion of the city's wealth in 1845 than in 1888, or to 
state the same blessed truth in a way more easily under- 
stood, 333 of the richest citizens of Boston owned more of 
her aggregate wealth in 1845 than 1,254 of her richest 
citizens owned in 1888. Sunrise is not more certain than 
is the fact that wealth is very much more evenly distributed 
among the people at the present time than at any previous 
date within the last seventy years. 



283 



THE LABORER AND THE CAPITALIST. 



CHAPTER XV. 

MILLIONAIRES. 

While the question of millionaires has already been dis- 
cussed in this work, yet I have discovered certain other 
facts which impel me to take another brief notice of the 
subject. In his Forum article previously quoted, Thomas 
G. Shearman has produced a table in which a certain num- 
ber of people are credited with property as follows : 
"200 persons at $20,000,000 each . 14,000,000,000 

400 " '' 10,000,000 " . . 4,000,000,000 

1,000 " " 5,000,000 " . 5,000,000,000 

2,000 " " 2,500,000 " . . 5,000,000,000 

6,000 " " 1,000,000 « . 6,000,000,000 



124,000,000,000'' 
It will be observed that Mr. Shearman has estimated 
that 9,600 men are worth an average of $2,500,000 each, 
or a total of $24,000,000,000. In a previous chapter of 
this work I estimated, or rather I conceded, that there 
might be four thousand individuals in the country, averag- 
ing one million each, and aggregating $4,000,000,000. 
Mr. Shearman's estimate of millionaires and their holdings 
are five hundred per cent, higher than mine. Yet I now be- 
lieve that I then conceded too much, and that there are 
not four thousand millionaires in the United States whose 
aggregate wealth amounts to $4,000,000,000. 

Now, reader, how shall we settle this question ? If you 

. 284. 



THE LABORER AND THE CAPITALIST. 

wanted to ascertain the number of millionaires in the United 
States, and you knew that there were two political parties 
disputing over the matter, and one of these parties should 
send a broad challenge in every direction for the purpose 
of locating the millionaires, and publishing the list of the 
names received week after week for several months, always 
asking that the reports be corrected or new names for- 
warded from any quarter or locality, and finally publishing 
the list, publicly asserting that no more millionaires could 
be found ; and the opposing party, always on the alert to 
criticise, should fail to contradict or to suggest a single ad- 
ditional name, would you not conclude that about all the 
millionaires had been reported? 

The history of the course of the New York Tribune in 
this matter, and the results obtained, are well known (or 
ought to be well known) throughout the country. As al- 
ready stated, four thousand and forty-seven reputed million- 
aires were found. The same journal has since said, in sub- 
stance, however, that later reports, and the death, bank- 
ruptcy, etc., of several of those who had been reported as 
millionaires, but who proved to be comparatively without 
property, indicated that the Tribune list contained more 
names than the country had millionaires. 

But the most satisfactory evidence I have been able to 
find, and that which has convinced me beyond all doubt 
that when I conceded 4,000 millionaires with property ag- 
gregating $4,000,000,000 I was conceding too much, ap- 
pears in the Surrogate Records of Massachusetts, quoted 
by Dr. Spahr. As I have already stated, large estates 

285 



THE LABORER AND THE CAPITALIST. 

almost invariably pass through the Surrogate Courts. And 
while the absence of the smaller estates from the Surrogate 
records, and the lack of data concerning their number and 
total value, render Surrogate figures valueless so far as re- 
lates to the comparative amounts of property held by the 
rich and poor, yet those records are a tolerably good index 
to the number of large estates. 

The records quoted by Dr. Spahr show that during the 
three years 1889-1890-1891, estates of $500,000 and over, 
numbering thirty, aggregating $23,841,879, passed through 
the Surrogate Courts of Massachusetts. A simple arith- 
metical calculation demonstrates that no more than seven- 
teen holders of the above-mentioned thirty estates could 
have been millionaires — the number of estates, and the 
aggregate amount, settle that question. It foUows, there- 
fore (reckoning from the same basis), that Massachusetts 
had, in the years 1889-91, not to exceed one hundred and 
eighty-nine millionaires — that is, if we aUow each to possess 
one million and no more. This, mark you, is one hundred 
and seven fewer millionaires than " common observation " 
reported to the Tribune from that State. In other words, 
the Tribune^ s estimate of the number of millionaires in the 
State of Massachusetts was at least 56 per cent, higher than 
the number indicated by her Surrogate records. The same 
proportions apphed to the country at large would indicate 
the number of millionaires in the United States to be 2,585, 
instead of 4,047, as per the guess of the Tribune's corre- 
spondents. 

Think of it, reader ! If this estimate is true, or if it ap- 

286 



THE LABORER AND THE CAPITALIST. 

proximates the truth, it annihilates the popular millionaire 
theory, which has been one of the principal causes of so 
much hard feeling against large property holders, and given 
sociahsm such a tremendous impetus in this country. 
Nevertheless I submit the foregoing data without the 
slightest fear that it wiU ever be successfully attacked. 



CHAPTER XVI. 

THE WAY INCOMES ARE ESTIMATED. 

While I have given several examples of the way incomes 
are estimated by those who hold to the common observation 
theory, yet I have another illustration at hand which ought 
not be omitted. 

On page 122 of his work, referring to the results of an 
investigation previously made by the Labor Bureau of 
Massachusetts, Dr. Spahr says : 

"While 6,000 families occupied dwellings worth 1150,000,000, 
60,000 families occupied dwellings worth 190,000,000. On 
Leroy Beaulieu's basis, that the poorer and middle classes devote 
one-sixth of their income to their dwellings and the wealthiest one- 
ninth, this signified that in Boston, as in foreign cities, seven per 
cent, of the families receive half of the aggregate income." 

It will be observed that if Dr. Spahr is right in assuming 
that Leroy Beaulieu is right in assuming that the poorest 
and middle classes devote one-sixth of their income to their 
dwellings, and the wealthier classes one-ninth, it then fol- 
lows that a certain few f amihes have an income so immense 

287 



THE LABORER AND THE CAPITALIST. 

as to render it certain that the division is wrong and the 
poorer classes robbed. However, at the end of the above 
quotation I find reference to a foot note which is intended 
to give more definite information and reads as follows : 

" The rentals and incomes of the 85,000 famiHes in Boston 
would stand as follows : 



Apartments. 


' 


Assessed Value of 






Rental 


Number. 


Property Occupied. 


Rental. 


Income. 


Under $300 


60,000 


$91,000,000 (at 10 p. c.) 


$9,000,000 


$54,000,000 


$300 to $900 


19,000 


112,000,000 (at 9 p. c.) 


10,000,000 


60,000,000 


Above $900 


6,000 


153,000,000 (at 8 p. c.) 


12,400,000 


113,000,000 




85,000 


$227,000,000" 



It should be stated that Dr. Spahr does not assume that 
the sum that appears under the title of Rental represents 
rent actually paid, but that those sums would ordinarily 
represent rental values, and from this he assumes that men 
occupying such houses would ordinarily be worth a certain 
amount of property, from which an income would be re- 
ceived approximately as tabulated in fifth column under 
the title Income. Following this table Dr. Spahr has made 
a statement that gives us a basis, from which we can de- 
termine with some degree of accuracy as to the correctness 
of his estimates. Referring to the richest 2,334 families 
in Boston, he writes as follows : 

" As they pay local taxes on $300,000,000 of real estate, an 
income of $75,000,000 would be about 7 per cent, on their proba- 
ble wealth. It is certain that these families receive at least one- 
third of the aggregate income." 

This gives us the data from which Dr. Spahr deduces the 

288 



THE LABORER AND THE CAPITALIST. 

incomes tabulated in the last column of the foregoing table, 
to wit: 175,000,000 is 7 per cent, on the wealth of the 
richest 2,334 families. In the foregoing table, however, 
he has tabulated the richest 6,000 Boston families, which, 
reckoning from his data, are worth $1,614,285,714, which 
is about 90 per cent, more than the total valuation of the 
whole city at that date. 

Upon the same basis the next class below, numbering 
19,000 f amihes, income $60,000,000, were worth a total of 
$857,142,857, which about equals the total wealth of Bos- 
ton at that time. While the third or poorest class, num- 
bering 60,000 families, with an income of $54,000,000, 
were upon the same basis worth $771,428,571, which sum 
is nearly equal to the total valuation of Boston at that date. 
Think it over. Dr. Spahr has made his calculations from 
a basis which, carried to its logical conclusion, and certain 
mathematical end, credits the citizens of Boston with wealth 
aggregating $3,242,857,142, which is nearly four times the 
city's wealth, and $440,000,000 more than the wealth of 
the entire State of Massachusetts. Every thoughtful reader 
will see how utterly fallacious such calculations are. Ac- 
cording to Dr. Spahr' s third and last calculation, the 60,000 
smallest rent payers in Boston are receiving $3 per day for 
every working day in the year. I think it would be diffi- 
cult to make Bostonians believe that 60,000 of their small- 
est rent payers are receiving an income of $3 per day. 



289 



THE LABORER AND THE CAPITALIST. 



CHAPTER XVII. 

FARMS AND CITIES. 

Probably no other set of facts is so generally and effectu- 
ally used to prove the concentration of wealth as that the 
rich are more numerous, and their fortunes larger, in the 
cities than in the rural districts. These, coupled with the 
no less notable fact that our cities are growing in wealth 
and population much faster than the country at large, has 
done much to generate the idea in the popular mind that 
there is a great disproportion of income in favor of the few. 

On page 46 of his work Dr. Spahr says : 

" The people on the farms and in the villages in the East have 
shared no more in the advancing wealth of the past quarter of a 
century than the people on the farms and in the villages of the 
South and West." 

On page 49, same work, a statement appears as follows : 
"We can hardly escape the conclusion that the average wealth 
of the families in the country districts does not exceed |3,250, 
while the average wealth of the families in the cities does exceed 
$9,000. When American political parties shall again divide upon 
issues vitally affecting the distribution of wealth, the clearly 
marked line of division will not be between East and West, but 
between city and country." 

The fact that the average wealth of the city is so much 
greater than that of the country districts is looked upon 
by Dr. Spahr as so strikingly indicative of a great inequality 
in the distribution of wealth and income, that he expects 

290 



THE LABORER AND THE CAPITALIST. 

the line of political controversy in the future conflict 
between capital and labor (so generally looked for by men 
of his faith) to be sharply drawn between the urban and 
rural population. That is, the time will come when the 
farming districts will say to the great cities : " Thou shalt 
rob and impoverish us no longer." 

Now it seems to me that if ever a theory was advanced 
and generally beheved that was bottomless, sideless, top- 
less — in fact, to use a homely but expressive term, " moon- 
shine " — it is the theory that cities are gaining wealth at the 
expense of the country, or that it is possible for the busi- 
ness and growth of the city to in any way antagonize the 
business and growth of the country. 

In the first place, every ounce and every farthing's worth 
of material that builds a city and sustains life therein, is 
bought and brought from the rural districts. It must fol- 
low, therefore, that the more wealthy and more populous 
the city becomes, the more she is obHged to purchase from 
the rural districts. Pray tell me, then, how the growth of 
a city can have any other effect upon the rural districts 
than that of promoting their growth and prosperity. 

If a large city, with its many factories and dense popu- 
lation, could be dropped down in one of the Gulf States 
about this time, to purchase all its sustenance from the 
rural districts, would it retard, or would it promote the 
financial well-being of the country round about ? To state 
this proposition is to argue it ; to ask the question is to 
answer it. The human understanding has no power to re- 
sist the conclusion that the estabhshment of one city, or 

291 



THE LABORER AND THE CAPITALIST. 

any number of cities, for that matter, would result in a 
great financial benefit to any region of country. 

The average wealth of families in the country is certainly 
less than that of families in the city. Let us suppose for 
the sake of the argument that the difference is approximately 
two-thirds, as claimed by Dr. Spahr. What of it ? It is 
not necessary to think more than once in order to realize 
that, all things considered, the difference is greatly in favor 
of the average country fortune. 

A family with no other source of income than the aver- 
age fortune could not long exist on nine thousand dollars, 
for example, in one of our large cities, while a three-thou- 
sand-dollar farm, in the country would support an ordinary 
family any length of time. In other words, a man is richer 
with |3,000 in the country than with $9,000 in the city. 
If you suggest that if my theory were right the city people 
would flock to the country rather than remain in the city, 
since it is human nature to seek the safest and most profit- 
able locality, I answer that the social instinct leads many 
people to the city, that would be much better off, pecun- 
iarily and otherwise, did they remain in the country. The 
theater, the dance hall, the thousand and one places of 
amusement, as well as lectures, music, schools, etc., etc., 
attract and hold tens of thousands in the city, who, finan- 
cially speaking, would be very much better off in the rural 
districts. 

Cities are one of the natural and necessary results of 
higher civilization, and their growth is the growth of a 
great variety of industries as compared with the single 

292 



THE LABORER AND THE CAPITALIST. 

industry of agriculture. And if the profits accruing to 
city industries were individually, so to speak, below the 
profits accruing to agriculture, yet so numerous are these 
city industries that their profits, though individually 
smaller, would, nevertheless, aggregate vastly more than 
those of the rural districts, and the increase in the value 
of the cities as a whole would necessarily be very much 
more rapid than that of the country outside of cities. 

It would be marvelously strange if a great number of 
important industries could not, or did not, increase faster 
as a whole than any single industry considered alone, be 
it farming or what not. 

The one true way to ascertain whether the agricultural 
interest is receiving a just proportion of the increase from 
all industry is to compare the profits on capital therein 
invested with the average profit on capital invested in other 
industries. When this is done, the grand average must be 
about the same, for the all-sufficient reason, explained in 
previous chapters, to wit : Capital will hasten to invest in 
industries yielding the larger percentage of income, until 
the profits of such industries are reduced to a level with 
those of others. 

When a new industry comes into existence, the prospects 
of large profits (and indeed the profits are often large in 
new industries) attract capital, and the growth of such in- 
dustries (if we use the percentage as a criterion) is almost 
sure to outstrip the older for a time, although it may not 
continue to do so, as generally they cannot. The reason 
for this is plain, when we consider that after, say one dol- 

293 



THE LABORER AND THE CAPITALIST. 

lar nas been invested in a new industry, tlie investment of 
another dollar means a hundred per cent, increase. As for 
example : When there was but one farm, the addition of 
another made an increase of a hundred per cent. Of 
course that rate of increase could not long continue. Some 
of our leading industries, in their infancy, increased a 
hundred per (^ent. per annum and even more. But had it 
been possible for any one of these larger industries to 
have continued that percentage of increase, it would have 
absorbed the capital and population of the earth long ago. 
A hundred per cent, annual increase in our farming in- 
dustry would in a very few years leave no more land to be 
occupied, and I might add that the increase that has al- 
ready taken place in American agriculture within the last 
three decades, has brought into use nearly all of our vast 
public domain, which was once looked upon as practically 
inexhaustible. And the time is near, indeed it now is (in 
a large degree), when if a man engages in farming he is 
obliged to hire land. And, mark you, this rapid exhaustion 
of our available farming lands has no little to do with the 
recent increase in the number of farm tenants. Why 
should it be assumed that the more rapid growth and 
greater wealth of the cities is owing to the robbery of one 
class by another, when, as a matter of fact, manufac- 
turers and their employees, for the sake of convenience, 
nearness to railroads, etc., have settled in cities, and the 
effect upon cities has been precisely what it would have 
been upon any other part of the country had they settled 
there, to wit : A great increase of wealth and population. 

294 



THE LABORER AND THE CAPITALIST. 

The location of any considerable number of factories in a 
rural district will create a new city, the increase in wealth 
and population of which mil be more rapid than that of 
the surrounding country ;, and for the very good reason that 
it will embrace a greater number of industries. Never- 
theless it will not lodge the wealth in fevv^r hands, but it 
will bring the property of more individuals into one 
locality, and draw more workmen together for a common 
purpose. 

Under such circumstances, laborers and capitahsts will 
leave the country more or less and go to the city. Every 
one that does this, however, ceases to be a competitor of his 
former neighbor in the country, to become his patron in 
the city. When farmers thus exchange competitors for 
customers, it makes the cities grow, but does it make the 
city a robber of the rural district? Does it render the 
farmer's income smaller or his opportunities less ? 

We have compared the growth of a single industry (the 
raiboad) with that of agriculture. Before we pass to the 
consideration of other important factors in the farm and 
city problem, let us compare the growth of factories with 
that of agriculture. According to census reports (see 
Mulhall, North American Bevieio, June, 1895) from 1850 
to 1890 our factories grew from $520,000,000 to $3,059,- 
000,000, or 5.88 times. The farms during the same 
period grew from $3,967,000,000 to $15,982,000,000. 
Adding the $8,000,000,030 lost by the rural districts of the 
South during the war, as before explained, carries the value 
of the farms in 1890 to 6.04 times their value in 1850. In 

295 



THE LABORER AND THE CAPITALIST. 

other words, all other things being equal, the farming 
industry since 1850 has at least held its own with manu- 
factures, and so it must continue to do in the long run — per- 
haps not in the total percentage of growth, however, but in 
average profit on each dollar invested, it must for the reason 
abeady explained: That competition, resulting from the 
desire for gain on the part of capital, will reduce all profits 
to a common level sooner or later. 

It is not easy to understand how the idea originated that 
the city was flourishing at the expense of the country. 
So far as independence is concerned, the country can live 
without the city, while the city cannot live without the 
country ; but as regards the division of income resulting 
from the efforts of both — as a whole, and in the long run, 
one can no more get too large a share than capital or labor 
can get too large a share. They are the emploj^ers of each 
other and the patrons of each other. They buy and sell, 
back and forth. Whatever the city receives from the coun- 
try, for which it renders no equivalent, precisely that much 
less will the country have with which to purchase from the 
city. In other words, by wrongfully taking from the coun- 
try, the city will lose that much of country trade sooner or 
later. Where is the permanent gain ? 

Whoever will study this subject as searchingly as it de- 
serves, will discover that gains resulting from a wrong divi- 
sion of income are exceptional and not general ; temporary 
and not permanent. Again, if the great cities are getting 
too large a proportion of the general income, the same 
must be true of the smaller cities, since they are doing 

296 



THE LABORER AND THE CAPITALIST. 

business upon the same basis as the larger. Yet we never 
hear the farmer complain of a neighboring village (a city 
in embryo) which is a better market for his butter and eggs 
for the very reason that it, in turn, has a still larger mar- 
ket in the more distant city. 

I apprehend that the wrong impression gone abroad from 
the great cities is largely due to the fact that they are 
credited with and assessed for a vast deal of wealth which 
is, to all intents and purposes, the property of the country 
at large. There are millions upon millions of wealth in 
ocean transportation, from the majestic steamship and 
stately sailer to the tug and lighter ; the docks, the wharves, 
the warehouses, etc., etc., all employed, in no small degree, 
in moving hither and thither across the waters the products 
and necessities alike of farm and factory. Then there are 
the terminals of the great railroads, reaching far into 
the millions; they, too, constitute a part of the machinery, 
so to speak, of transportation for both city and country. 
Then, there are the buildings and hundreds of milHons of 
other assets of insurance companies, but whose real owners 
are scattered throughout the land. 

All this paraphernalia of shipping, of inland transporta- 
tion, of fire and life insurance, etc., etc., etc., is as neces- 
sary an adjunct to the farm as to the city, and which, 
if removed from the city, would reduce its apparent wealth 
immensely, possibly one-half, and vanquish at once and for- 
ever the ghost of city concentration v/hich now haunts the 
dreams of so many of our intelligent and patriotic citizens. 

But this prodigious wealth, this handmaid of industry 

297 



THE LABORER AND THE CAPITALIST. 

and commerce, cannot be taken from tlie cities. It lias 
been placed there by the necessities of our civilization. It 
means economy and saving for the whole population, and 
no viorefor one class than for another. The handlers and 
transporters of farm, and indeed all products, the insurance 
companies, the numerous printing and publishing houses, 
the commission merchants, the captains of the great fac- 
tories, have found that they could serve the interest of 
others, and consequently their own interests, best, by locat- 
ing in the city, and operating from a common center. The 
practice of locating in the cities and operating from a com- 
mon trade center is as natural as is the system by which the 
extremities of the human body are reached from the heart 
center. 

" But," say our opponents " see how it makes the cities 
grow and how it concentrates wealth in the hands of a few." 

I deny that it concentrates wealth. When certain among 
the most enterprising in the rural districts have gained a 
suiScient amount of property to warrant their engaging in 
business on a larger scale than their own locality demands, 
then they pack off to the city with their capital. Owing to 
the large amounts generally required to engage in city 
enterprises, they are often obliged to associate themselves 
with others of their class. Then it not infrequently 
happens that to finally secure the desired amount they must 
become a corporation, and issue stock in ; shares ranging 
from one to a hundred dollars of par value. 

Here the door of advancement is opened wide and the 
general pubHc invited in, as it were, to share the profits of 

298 



THE LABORER AND THE CAPITALIST. 

its own industry. All this has not resulted from the 
philanthropy of capital. It has come from the fact that 
immense aggregations of wealth have become so numerous^ 
and large concerns produce at so small a profit, that the 
average capitaKst, or say one who thirty years ago would 
have ranked as a large capitahst lacks the means to success- 
fully compete with them, and therefore has been obliged 
to invite his poor neighbors to come in with their smaller 
amounts. 

Therefore that which our radical friends call the concen- 
tration of wealth has made it possible for the poorer 
classes to become interested in business with the larger 
capitaUsts, and has resulted, and is resulting, in a wonder- 
ful diffusion of wealth among the masses. 

I read in our leading journals that Mr. Debs and his co- 
workers are about to organize a very great movement 
among the laboring classes, the object of which is to insti- 
tute a new economic system. He expects to make the first 
great settlement in a Western State, a part of his object 
presumably being to get as far as possible from the money- 
loaning centers of the East, which are supposed to be tak- 
ing to themselves a larger percentage of the earnings of 
the people than the money they loan creates for the peo- 
ple. Undoubtedly Mr. Debs shares the opinion expressed 
by Dr. Spahr in his work, to wit : Capital gets two-fifths 
and labor three-fifths of the results of human energy. With 
all deference to the inteUigence of these men and a high 
regard for the motives that actuate them, I nevertheless 
submit, as I have already done in substance, that, as a mat- 

2Dy 



THE LABORER AND THE CAPITALIST. 

ter of fact, capital does not get over six per cent, of the re- 
sults of a common industrial effort. One great reason per- 
haps is that capital charges only six per cent, for the ser- 
vice it renders. But the still greater reason is the rapidity 
with which capital multiplies itself and creates profits for 
others as it moves on through the channels of trade and 
industry. 

As for example: John Doe invests a certain sum in 
manufacturing. This calls for certain kinds of raw 
material, and the products of this material sell to the 
manufacturer at a profit. The carriers (teams, railroads, 
etc.) move the raw and finished material to and from the 
place of manufacture at a profit. The manufacturer sells 
it to the wholesale dealer at a profit ; the wholesale dealer 
sells to the retail dealer at a profit, and the retail dealer sells 
it to the people at a profit. Thus we see that while the 
manufacturers get one profit, four profits go to other classes 
of people, all of which increases the demand for labor, 
since, generally speaking, all profits go to employ labor, 
directly or indirectly. 

Capital is not doing this from philanthropic motives ; it 
is forced to it by the laws of trade and the eternal princi- 
ple of mutual dependence, explained in previous chapters. 
It may be safely assumed that, as a rule, when our men 
called capitahsts have realized a profit of, say, six per cent. 
on their investment, it does not amount to an average of 
more than one-fourth of one per cent, on the sum total of 
their transactions. In other words, when capital, money 
loaned, for example, has received a profit of 6 per cent. 

300 



THE LABORER AND THE CAPITALIST. 

for itseK, it has created 25 per cent, for the people at large. 

Had this not been true, the East, which has been loaning 
its money to the South and West in immense amounts for 
the last half century, would have substantially owned those 
sections years ago. Let us see what the result has been. 

(See Mulhall, North American Review, June, 1895, page 
649.) 

So far as the South is concerned, of course it fell back, 
as before explained, and as might be expected, during the 
decade from 1860 to 1870. Her fields were devastated by 
war and her products confiscated by hostile armies, but 
since 1880 the per capita wealth of the South has increased 
24 per cent., while that of the Eastern and Middle States 
has increased but 1 9-10 per cent. At the same time the 
per capita wealth of the Middle Western States increased 
21 per cent., and that of the Mountain and Pacific States 
increased 74 per cent. Or, if we draw the line between the 
strictly Eastern States, the more monej-loaiihig States, and 
the prairie States of the West, which are more especially 
the jRonej-horrowing States, we find that those prairie 
States have increased their per capita wealth eleven times 
faster than the Eastern States. This being true, the radi- 
cal claim regarding the profits of capital, and the further 
assumption that the Eastern money-loaners are impoverish- 
ing the West, are absolutely without foundation. 



CHAPTEK XVIII. 
In this work I have made no attempt to justify the pres- 

301 



THE LABORER AND THE CAPITALIST. 

ent condition of trade and industry, nor have I intimated 
that great improvement is not possible. I have labored to 
establish tlie fact that the interests of labor and capital 
are one and the same. And that the remedy for our po- 
litical and financial ills, whatever they may be, is not in a 
more socialistic government, but in a more thorough edu- 
cation of the people in first principles, from the richest to 
the poorest and from the highest to the lowest. 

Very rich people, that is, millionaires, or those whose 
fortunes approach that sum, are so few as to require little 
thought. But a competency and security for old age is 
of very great importance. And, generally speaking, the 
one sure road to that goal is through industry, temperance, 
self-denial, and economy. As a rule, he who does not 
practice these virtues cannot be rich. In a recent conver- 
sation with a shoe manufacturing concern in the city of 
New York, one of the firm intormed me that they had a 
hand in their employ to whom they were paying six dollars 
per day. They had paid him that price in war times, 
when the purchasing power of a dollar was less than half 
what it is at the present time, and he being an excellent 
workman they had not reduced his wages. But, said my 
informant, he made both ends meet then, and he does no 
more now. He lives up to his income now as he did then. 
Continued the employer, if this workman had been con- 
tent to live as he lived in war times, he could have saved 
an average of three dollars per day for the last thirty 
years, which, loaned at a fair rate of interest or invested 
where it would have yielded him a moderate profit, would 

302 



THE LABORER AND THE CAPITALIST. 

have made him worth more than any member of this firm, 
and probably he could have bought and paid for the entire 
concern. I took occasion to make inquiry in fifty of what 
I considered average retail business estabhshments in one 
of our Eastern States^ for the purpose of learning as near 
as possible what their average daily savings had been 
for the last twenty years. One had cleared 1 60,000, 
or an average of $10 per day. Of course he had con- 
ducted a large business. A large majority had gained 
little or nothing above a living, while several had fallen 
behind ; but the average for the whole fifty had not ex- 
ceeded 80 cents for each working day. 

The government statistics show that the growth of the 
country in wealth amounts to a saving of only twelve cents 
a day for each inhabitant. The saving of twenty-five cents 
per day for twenty-five years, compounded semi-annually, 
will insure the average individual against the danger of 
dependence or want in old age. 

If we deduct from the reputed wealth of the country the 
$25,000,000,000 which the Special Census Agent, before 
quoted, says are inflated values, it mil not leave the average 
gain or savings of the country more than $700,000,000 
per annum for the last fifty years. It is a fact which I 
would reiterate and which must not be lost sight of, that the 
money spent for hquor in the country amounts at the pres- 
ent time to at least $1,000,000,000 per annum. In other 
words, the liquor di'inkers of America spend 40 per cent. 
more each year for intoxicating drinks than the average 
annual savings of the whole population of the country 

303 



THE LABORER AND THE CAPITALIST. 

during the past fifty years. It is hardly necessary to add 
that this prodigious amount of money has not been spent 
by the five million who now have savings bank accounts -, 
nor by the four out of five million of farmers who own 
farms ; nor by the nearly two miUion who have money 
invested in building and loan associations ; nor by the two 
million, more or less, of the successful business men of the 
country, because neither of these classes of people could 
have accomplished what • they have and at the same time 
drunk liquor to any considerable extent. A very large 
preponderance of the money spent for intoxicating drinks 
is spent by the class of people 40 per cent, of whom 
admitted to the agents of the Massachusetts Labor Bureau 
that they were occupying the bad tenement houses because 
of intemperate indulgences. 



CHAPTER XIX. 

TENEMENT HOUSES. 

As I read of, and in fact observed, what multitudes of 
people swarmed the tenement houses, it appeared plain 
enouo^h to me that the avarice of capital was leavino" less 
and less room for the masses in the cities. But when I 
observed that the wealthy were taking to the tenement- 
house plan, an inquiry f oUowed which soon opened my eyes 
to the fact that a large majority of our rich and compara- 
tively rich citizens were tenants. And as to the room oc- 
cupied by families, the Boston Census for 1845 (page 54) 
shows that, as far back as 1845, the number of persons to 

304 



THE LABORER AND THE CAPITALIST. 

a dwelling averaged 10.57, while in 1890 they averaged but 
8.52. In this connection it is important to consider, as I 
have previously stated in the body of this work, that the 
tenement houses of to-day are better provided with sanitary 
arrangements, and I estimate that the amount of space 
allowed to each family is at least 30 per cent, greater than 
it was fifty or even thirty years ago. 

Again, such knowledge as has been lately communicated 
to me regarding the more crowded tenement houses of our 
cities ought to be communicated to the general pubhc. A 
rehable real estate agent in New York said to me substan- 
tially as follows : 

" In a majority of cases with the occupants of the poorer tene- 
ment houses of New York, it is a matter of choice with them. 
They are from the poverty-stricken districts of the Old World, 
and therefore not accustomed to much room ; and as to the more 
perfect sanitary arrangements, they don't want them ; and above 
all, they don't want to occupy quarters where they will be obliged 
to observe the ordinary rules of cleanliness." 

When we add to this the further fact that 40 per cent, of 
the occupants of the bad tenements of Boston confessed to the 
Labor Bureau that they were there on account of intem- 
perance, it appears to me that an element a thousand times 
more powerful than what is caUed the avarice of capital is 
present in the tenement-house problem, to wit, the saloon. 
It is well to add, however, that what is true of Boston re- 
garding the number of persons to a dwelling is true of a 
very large majority of our leading cities. The people are 
getting more and more and better and better room. 

305 



THE LABORER AND THE CAPITALIST. 

Referring to the woeful condition of some of our very 
poor people, Carroll D. Wright wrote as follows : 

" So far as my owe observation goes, drunkenness was at the 
bottom of the misery, and not the industrial system or the indus- 
trial conditions surrounding the men and their families." (See 
Waldron's work, page 39.) 

I do not doubt for one moment, neither do I believe any 
candid student of the subject can doubt, but that the solv- 
ing of the temperance, or rather the intemperance, problem 
will largely solve the problem of poverty. 

Mr. Debs and other distinguished advocates of the labor 
cause would improve the condition of labor by establishing 
a colony and inaugurating a new economic system in a 
sparsely settled section of the country. Their efforts are 
most needed in the more densely populated cities. 

Work there ! Change the habits, rectify the morals, and 
enlighten the minds of the masses in those densely popu- 
lated localities, and it can hardly be doubted that our pres- 
ent system of economics will be as satisfactory as any that 
can be devised. 

We have no reason to blame the rich for present condi- 
tions, only as the rest of us are to blame for not doing all 
we might for our feUow-men and ourselves. Our wealthy 
citizens are engaged in business almost to a man, and, as a 
rule, one dollar invested creates at least six dollars of new 
business. A man with a plant worth a million usually trans- 
acts about six millions of business every twelve months. 
This means that his investment passes through the hands of 
the people once every sixty days. And can you think of any 

306 



THE LABORER AND THE CAPITALIST. 

set of men who have the energy and power^ or who would 
be likely under any circumstances to send millions whirling 
round and round through the hands of the great public 
more rapidly than do those who now control those millions ? 

If Mr. Debs will stop to weigh the matter carefully^ and 
think down to the bottom of the subject, he will discover 
that, if he is to succeed in any movement requiring the co- 
operation of any considerable number of people, he must 
pick his men. He cannot find a spot under the canopy of 
heaven where he could succeed with a majority of his 
colony, or even a large percentage of it, composed of peo- 
ple whose habit it is to spend more for liquor than they 
could be induced to spend for food and education. If Mr. 
Debs would successfully fight the strongest foe that labor 
and good government ever had, let him not flee from the 
enemy's country, where his services are most needed. 

Labor has much to contend with, but no more than capi- 
tal. Labor often suffers, but no more than capital. When 
an employing capitalist becomes bankrupt his employees 
are thrown out of work and lose days, and sometimes 
months, of valuable time. But it should not be forgotten 
that the bankrupt employer has lost his fortune, which rep- 
resented the earnings and savings of a lifetime. It is sad 
to think that labor has to endure the sweatshop, which not 
infrequently forces him to work for lower wages. But the 
laborer should remember that the cheaper goods turned out 
by the cheap labor of the sweatshop compel the competing 
capitahst to sell at lower rates, which shrinks his profits. 
The sweatshops should be abolished, but to accomplish this 

307 



THE LABORER AND THE CAPITALIST. 

capital and labor must combine, as they finally will, because 
their interests are equally concerned. 

There is yet one more argument that must not be 
omitted. I refer to the Surrogate records quoted by Dr. 
Spahr : 

The only way, however, that our Surrogate records can 
be made use:^ul to the general economic discussion now 
going on among the people is through proportions, — that 
is, if a certain proportion of estates of varying wealth have 
passed through the court for the past three years, for exam- 
ple, it may be assumed that something near the same pro- 
portion is passing through year after year, and by 
comparing one series of years with another, we can deter- 
mine which period found the largest share of the nation's 
wealth in the hands of the very rich, whose estates are very 
generally probated. 

Dr. Spahr has furnished us with an excellent oppor- 
tunity to make such a comparison. 

On pages 176 and 179 he has introduced Massachusetts 
Surrogate records for the years 1829-30-31 and for the 
years 1889-90-91. 

One of these records shows that during the former 
period (1829-31) only two estates valued at more than 
$500,000 were probated, and that they aggregated only 
$1,267,817. The other record shows that during the latter 
period (1889-91) thirty estates above $500,000 were pro- 
bated and that their aggregate value was $23,841,879. 
The presentation of this record by Dr. Spahr is as much 
as to say : " Behold how fearfully wealth has concentrated 

308 



THE LABORER AND THE CAPITALIST. 

during those sixty years." The masses, the legislators, 
indeed the people everywhere, are reading these and similar 
statements, and wondering what is to come of it all. 

If Dr. Spahr would prove that the wealth of the country 
has been concentrating during the sixty years in question, 
his records must show that a given proportion of estates 
comprised a larger proportion of the nation's wealth in the 
years from 1889 to 1891 than they did in the years from 
1829 to 1831. Do his records show it, is the question? 
These are the facts. While the two largest holdings pro- 
bated during the former period, aggregated, as before 
explained, only $1,267,817, they nevertheless constituted 
8.75 per cent, of the total amount probated during that 
period, while $4,962,325, which represents the value of a 
proportionate number of the largest estates probated from 
1889 to 1891, amounted to only 3.19 per cent, of the total 
probates during that period. In other words, according to 
the Surrogate records, the two largest deceased holders had 
possessed 161 per cent, larger share of the property of 
Massachusetts in the years from 1829 to 1831 than the 
same proportion of the largest holders had held in the years 
from 1889 to 1891. 

Moving down Dr. Spahr's table, I select for the next 
class of estates for comparison all above $100,000 in 1829- 
31. The records of that date contain eleven of these hold- 
ings, and they aggregate $3,128,715, or 21.58 per cent, of 
the total probates. Taking the increase in the number of 
probates for a basis (3.13 times), the proportionate number 
of largest estates for 1889-91 show an aggregate of $25,- 

309 



THE LABORER AND THE CAPITALIST. 

847,1795 or 16.61 per cent, of tlie total amount probated, 
which means that 29.92 per cent, larger proportion of 
wealth was in the hands of the richer class in 1829-31 
than in 1889-91. 

Still moving down Dr. Spahr's table, I select for com- 
parison all above ^50,000 in the older table. There were 
tliirty-six of 'these estates, and their aggregate value was 
$-1,957, 862, or 34.20 per cent, of the total amount pro- 
bated. The proportionate number of estates (112.68) in 
the years 1889-91 aggregated $38,747,138, or 24.90 per 
cent, of the total amount probated, the same showing 37.35 
per cent, greater proportion of wealth in the hands of the 
few in 1829-31 than in 1889-91. 

Not long since, I saw in a work published in 1850, re- 
ports o£ two canvasses of Massachusetts, by different agen- 
cies, for the purpose of ascertaining the number of wealthy 
people then residing in the State, and the amount of their 
holdings. The reports v/ere not official, therefore I do not 
quote them, but it may be remarked that they indicated 
what the official records I have presented prove, to wit: — 
those whom we call "the few " held a much larger propor- 
tion of the property of the old Bay State in those days than 
a corresponding proportion of the population hold at the 
present day. John Quincy Adams was credited with 
$400,000. 

We think of our National lawmakers as being rich now- 
adays, and many of them are, but then the same was true 
of the legislators who served in the early days of the Eepub- 
iic. The Y/ealth of our present Senate is not as great for 

310 



THE LABORER AND THE CAPITALIST. 

this day as was that of the Senate of 1800 for that day. 
With the present state of feeling toward rich people, it 
would be impossible to elect a man to the Presidency own- 
ing as large a share of the National wealth as Washington 
or Adams owned. 



FINIS 



MAY y ]^[)6 



